What is a Knowledge Management System and How Can it Help Your Business?
Great organizations don’t succeed just because they provide an amazing service or have a fantastic product. To really be successful, a business needs to have a group of talented, skilled, and highly knowledgeable people behind it. And it needs to make the most of their knowledge. Doing so requires an effective knowledge management system.
Knowledge management is a business concept related to capturing, storing, sharing, and managing the collective knowledge of a company’s employees. A knowledge management system is an IT system that facilitates knowledge sharing and allows for enhanced organizational learning.
This article examines exactly what a knowledge management system is and looks at why it’s so important for a modern business. You’ll learn what the key features of a good knowledge management system are and how these capabilities can boost your business. We’ll even provide some recommendations on what to look for when choosing a knowledge management system.
What is a Knowledge Management System?
All companies have their own unique internal cultures. Company culture sets out the values and the goals of the organization. A company with a strong culture will have good levels of employee engagement. The more engaged employees are the more productive, loyal, and satisfied.
Engaged employees are also much more likely to share knowledge and collaborate between departments. This knowledge sharing drives innovation and establishes a more dynamic and creative working environment.
Developing a knowledge sharing culture within an organization isn’t an easy task. One of the key ways of building an internal knowledge sharing culture is to implement a knowledge management system.
Typically, a knowledge management system is a software solution designed to capture, organize, store, and facilitate the retrieval of an organization's collective knowledge and information.
The primary goal of a knowledge management system is to create an environment where individuals and teams can easily share, access, and apply the organization's intellectual assets, experiences, and expertise.
Why Are Knowledge Management Systems So Crucial?
Collecting and categorizing knowledge in one central repository helps employees to solve problems faster. A knowledge management system also gives employees a deeper understanding of how company processes work across departments. This breaks down information silos and encourages knowledge sharing. A knowledge management system also strengthens organizational culture by promoting organizational values and goals.
The impact that an effective knowledge management system can have is significant. The importance of good knowledge management within a corporate culture is reflected in the value of the knowledge management industry. In 2020, the global knowledge management industry was estimated to be worth US $381.5 billion. This figure is projected to reach US $1.1 trillion by 2026. 1
74% of organizations hold the belief that implementing knowledge management and fostering information sharing can lead to a productivity boost ranging from 10% to 40%, as research from TSIA has shown.2
How does a knowledge management system work in reality? Let’s look at a hypothetical scenario.
How a Knowledge Management System Works
Imagine a customer service agent trying to solve a customer’s issue. The employee is relatively new to the company and has only undergone basic training. They don’t have a lot of product knowledge or experience with internal systems. They don’t have a strong grasp of what the company stands for or how they should appropriately communicate with customers.
Without a knowledge management system, this employee will struggle to find a solution quickly. Most likely, they will need to seek advice from a superior or a more experienced colleague. This prolongs the encounter, adds to the customer’s frustration, and may cause the loss of a customer, tarnishing the company’s brand and image.
If our imaginary employee was able to access a knowledge management system, they would have been able to bring up an answer to the customer’s query in seconds. The system would also have documented how the support agent found the answer and provided a deeper explanation of the issue.
The customer would have been satisfied that their issue was resolved efficiently, and the employee would gain a better understanding of their role and how the company functions. The use of a knowledge management system resulted in increased levels of customer satisfaction, brand loyalty, and employee engagement.
It’s clear that knowledge management and knowledge management systems are integral to the operations of any modern enterprise.
The Three Types of Knowledge
Generally speaking, a company needs to collect three different types of knowledge:
- Explicit knowledge: Any kind of tangible information or expertise that can be easily collected, documented, and shared. For example, best practices, sets of instructions, or steps in a process. Explicit knowledge represents information about what is being done.
- Implicit knowledge: Implicit knowledge is the unspoken, intuitive understanding and skills that people have but find difficult to put into words. Implementing implicit knowledge is the act of putting explicit knowledge into action to create a desired outcome. Needless to say, gathering and documenting implicit knowledge is a difficult task. Implicit knowledge represents knowledge about how things are done.
- Tacit knowledge: This refers to knowledge that is gained through experience. Tacit knowledge enables effective decision-making and problem-solving through a more intuitive and subjective understanding. Like implicit knowledge, it is exceedingly difficult to gather and share. Tacit knowledge represents expertise, it informs why actions take place.
Information Management and Knowledge Management
Information management is primarily concerned with the organization, storage, retrieval, and dissemination of information. It focuses on the efficient handling of data and documents, often emphasizing technologies and processes for managing information resources.
Knowledge management goes beyond information by capturing, organizing, and leveraging the intellectual assets, experiences, and expertise of individuals to create a collective knowledge base.
Information management deals with the structured handling of data and documents, while knowledge management harnesses the insights, experiences, and know-how of individuals to create a more informed and innovative organizational culture.
Common Components of a Knowledge Management System
A knowledge management system enables internal knowledge sharing and organizational learning. It can inform managers, content creators, customer support staff, salespeople, and other team members. Knowledge management systems can also be used to inform external stakeholders such as board members, customers and users, or potential investors.
A modern knowledge management system is a highly complex entity comprising of many interacting or interdependent elements. In many cases, a company will appoint a chief knowledge officer or create a dedicated team to ensure the knowledge management system is kept current and is being used correctly.
Although every knowledge management system will be unique to the company that has designed it, there are similarities that all systems share.
There are three major components to any knowledge management system:
- Employee expertise and company culture
- Organizational structure and internal processes
- Technological tools
Employee Expertise and Company Culture
A company’s processes, products, and services are created and optimized by the knowledge of its employees. How a company engages and provides value to its customers depends on a good understanding of its target market’s needs and wants. Best practices for internal processes are developed and refined by organizational knowledge, information, and data. A strong company culture will encourage employees to share expertise and insights.
Organizational Structures and Internal Processes
To make the best use of the collective expertise and skills of its employees, an organization requires a solid framework that facilitates knowledge sharing. Clear organizational structures and standardized processes allow employees to more easily break informational silos.
The essential technical components of a knowledge management system include specific content, controlled access, artificial intelligence (AI) functionalities such as chatbots, natural language processing, and reasoning for intent inference.
A knowledge management system will also include tools such as:
- Knowledge repositories
- Collaboration tools
- Search and retrieval mechanisms
- Document management system
- Analytics and reporting tools
- Workflow automation features
- Training and onboarding modules
- Social collaboration features
Advantages of Implementing a Knowledge Management System
Every successful organization depends on a pool of highly experienced, knowledgeable, and talented employees. But just having a great group of people isn’t enough. To avoid the loss of skills and organizational knowledge, a business needs to document the collective experience and wisdom of its employees.
And yet even having a centralized repository of knowledge isn’t enough. An organization then needs to find the best way to consolidate, integrate, and share this knowledge throughout the company. Knowledge management systems allow for the seamless flow of information and data throughout a company and toward its customer base.
Regardless of what type of business sector you operate in, your company can benefit from implementing a modern knowledge management system.
A knowledge management system enhances knowledge sharing and organizational learning across all levels of a company. It promotes a culture of transparency and openness in an organization. It provides a platform where employee expertise and feedback from customers can be shared.
A modern knowledge management system stores and organizes data. Having easy access to a repository of accurate organizational knowledge allows decision-makers to make timely and well-informed decisions. Being able to view correct procedures, case studies, step-by-step instructions, or even differing options can vastly improve the quality and speed of decision-making processes.
Wasted time is wasted money. No manager wants to see their employees wasting time by searching for information or performing the same task over and over until they get it right. Because they ensure quick access to procedural information, knowledge management systems reduce redundant effort and optimize workflows. The result is improved operational efficiency, enhanced productivity, and increased cost-effectiveness.
Fosters Innovation and Continuous Improvement
The modern marketplace is crammed with companies all desperately competing for customers and a greater market presence. Continuous improvement and innovation are crucial for businesses to stay competitive and adapt to rapidly changing market demands.
A knowledge management system provides a centralized platform for collecting, sharing, and analyzing valuable insights and feedback from customers and employees. Best practices, lessons learned, and new ideas can be shared and promoted.
This fosters a collaborative environment that can drive innovation. It also promotes continuous organizational learning as teams collectively benefit from shared knowledge and experiences.
Common Types of Knowledge Management Systems
Like any business practice, there are established frameworks for knowledge management systems.
There are three main frameworks used to create knowledge management systems:
- Enterprise-wide knowledge management systems: Designed to be used by anyone in an organization, these systems provide access to generalized information aimed at streamlining procedures and organizational productivity.
- Knowledge work systems: For use by professionals and knowledge workers who engage in specific decision-making and problem-solving tasks. These systems are precisely targeted and usually contain tools for data analysis, information retrieval, and collaboration.
- Intelligent techniques: These systems apply artificial intelligence (AI) and machine learning (ML) algorithms to enhance the processing and analysis of information. They uncover new patterns and provide insights and recommendations that can allow for task automation and enhanced operational productivity and efficiency.
How to Select the Most Effective Knowledge Management System
Organizations are in desperate need of more effective ways to share critical data and accumulated corporate knowledge. Companies are now collecting more data from more sources than ever before. Additionally, the wake of the COVID-19 pandemic has led to an increase in remote working. Business leaders need to disseminate information amongt employees who may be located anywhere in the world.
Choosing the right knowledge management system is critical.
To be truly effective, the system will need to seamlessly integrate into your existing workflows. It must facilitate easy access to information and promote collaborative knowledge sharing among teams.
Take into account the features of the knowledge management system and how they will fit into your organizational structure. A knowledge management system should have a range of tools that align with your organization’s specific needs.
It takes considerable time, effort, and expense to implement a knowledge management system. Carefully prepare a methodology to evaluate your needs and the efficacies of a proposed system and you can avoid wasting valuable resources.
A Streamlined Implementation Process
A strategic implementation process should be developed. Take note of exactly what your company needs are and what you want the knowledge management system to be able to achieve. Even a simplified knowledge management system using an existing template can take a considerable deal of time and money to set up. A detailed cost-benefit analysis will help to narrow down what system will work best for your needs.
An Easily Updatable and Scalable System
Knowledge moves at a frantic pace in the business world. Information that is crucial to operations one month can become outdated and irrelevant in the next. Choose a knowledge management system that can accommodate new advances in technology and ever-changing expertise and workflows. This means looking for a solution that can be easily updated when and as required. Be sure that the system can be scaled up and down to meet changing company requirements.
A User-Friendly, Intuitive Interface
Ease of use is a major factor to consider when choosing a knowledge management system. The navigation must be intuitive, clear, and familiar to users at all organizational levels.
A Robust Search Functionality
The system must have a powerful search function that brings back relevant results quickly. A reliable search function is also crucial to the scalability of a system.
Teams must be able to share insights, experiences, and expertise effortlessly. Look for a system with features such as real-time collaboration tools, discussion forums, and shared document editing capabilities. These collaboration tools will promote interactive communication and facilitate the exchange of knowledge among team members.
Integration with existing applications and workflows is vital. Otherwise, your business runs the risk of fragmenting your knowledge. A knowledge management system that doesn’t easily integrate with existing apps will hamper efficiency and decrease uptake levels.
Automation capabilities are crucial in a knowledge management system. Using AI-powered automation, a system can streamline routine tasks, such as data categorization and content tagging. Users can avoid spending time on the mundane and instead focus on higher-value activities like analysis and decision-making. Automating repetitive processes improves efficiency but also ensures consistency and accuracy.
Comparisons of Popular Knowledge Management Systems
Knowing what to look for in a knowledge management system is one thing. Finding the optimal system from the hundreds of products available on the market is another. We’ve gathered some key info on the top knowledge management systems to help you make an informed choice.
Launched in 2007, Zendesk is designed to assist customer support teams. It provides a range of tools that enable customer service agents to access information and resolve customer issues quickly. The company states that more than 40,000 small to medium enterprises use Zendesk to assist over 160,000 customers in over 30 languages.
- User Interface: Zendesk is intuitive and has a simple interface.
- Functionality: Zendesk is compatible with a wide variety of other applications and provides a robust internal knowledge base. It is, however, primarily designed for customer support.
- Pricing: Zendesk has a range of pricing options from $19.00 per month to $99.00 per month.
- Customer Support: Zendesk falls short in the support stakes. Many users have reported that Zendesk customer support is sub-optimal.
- User Reviews: Rated 4.3 stars out of 5 stars by most users.
Guru has been hailed as the new face of knowledge management platforms. The system organizes information into short snippets that can be easily searched and retrieved. The app is touted by the company as being an ‘all-in-one wiki, intranet, and knowledge base’.
- User Interface: While Guru has many benefits, some users report that mastering the interface is tricky and takes some time.
- Functionality: Guru has AI-powered functionalities such as auto-suggestions. The app also has useful collaborative features like in-context commenting and dedicated team spaces.
- Pricing: Guru offers a free version, a builder version for $10 per month, and customized enterprise pricing options.
- Customer Support: Guru gets good feedback on its customer support, but some users say they are frustrated by the lack of a live chat function.
- User Reviews: Guru gets an average rating of 4.6 stars out of 5 stars by most users.
Document360 is designed to optimize the creation of public and private knowledge bases. The app is highly praised for its ability to provide users with access to relevant information quickly. This app has become one of the most popular knowledge management systems on the market.
- User Interface: many users report that Document360 has a user-friendly, intuitive interface.
- Functionality: Document360 has article version history, document tagging, AI-powered recommendations, and content migration features.
- Pricing: Prices range from a free version to $599 per project or monthly for an enterprise version.
- Customer Support: Like Guru, although Document360 is widely praised for its functionality, customer support is lacking. Many users say that integration with existing apps is difficult.
- User Reviews: Rated 4.7 stars out of 5 stars by most users.
As the old saying goes ‘Knowledge is power.’ The right knowledge management system in conjunction with digital document management systems can empower every employee at every level of an organization.
Insights, experiences, and expertise can be captured, stored, and shared to foster innovation and improve productivity. Workflows can be made more efficient, levels of employee engagement can be improved and customer satisfaction can be enhanced.
Ultimately, a knowledge management system encourages a culture of shared learning and ensures that the collective wisdom of the workforce is effectively harnessed for organizational success.
Make sure that the right information reaches the right people at the right time. Discover how the cutting-edge intranet technology from LumApps can help to promote knowledge sharing within your organization.