A key mechanism by which knowledge management fosters the creation and sustenance of competitive advantage is through what we like to call ‘innovation creation.’ In her 2000 treatise, Maryann Feldman, Professor of Public Policy at the University of North Carolina, notes that innovation as an economic entity is a product of the creation and dispersal of novel and economically profitable knowledge either as new processes, products, or even organizational frameworks. In other words, innovation of whatever type is a direct by-product of expertly curated knowledge.
Knowledge management allows for the expert curation of knowledge and, in so doing, helps bootstrap the business processes for innovation and innovation discovery. And, as Feldman rightly notes, innovation of the kind prospered by knowledge cuts across every facet of business operation. From management (as innovation to debut better strategic and functional organizational processes) to product creation (as innovation to create value defining and hard to copy products and services) to sales and marketing (as innovation to upstage the competition and other market forces), knowledge-driven innovation provides a mechanism to deliver transformative change. It allows businesses to act with gilt-edge efficiency for the derivation of maximum profitability.
Consider the typical fortune 500 tech company with multiple diverse talent pools and a distributed teams organizational structure. Without a robust knowledge management architecture, there’s a considerable risk of organization fractionation that would, in turn, result in knowledge and idea silos across the board. But as you probably imagine, if these talent pools and teams were to hone in on innovation and succeed in their quest of delivering on business objectives (through innovation), they need to operate in perpetual sync.
Team A working on the visual characteristic of a soon to be launched app must correspond not just with Team B working on the backend architecture but also with senior management and sales and marketing who have direct business insights as to what connects and converts with the target audience. A knowledge management framework, deployed, for instance, as a Community of Practice suite, connects both Team A and Team B, allowing for tactless integration and free-flow dispersal of critical expertise while creating a pipeline for management (and other key stakeholders) to plug into the process cycle.
In this example set, knowledge management is both a process optimizer and an innovation driver. It is facilitating the seamless dispersal of knowledge among individual factions of a business enterprise, ergo promoting innovation, and as an added perk scaling down the friction that usually exists between management and employees. Again, this emphasizes the versatility and wholly encompassing nature of a strategically deployed knowledge management framework. More than deliver on specific business goals, it’s a tool that redefines every facet of business operations with a top-down effect of sharpening efficiency across all business channels.
Effective knowledge management can lead to innovation in several ways:
- By capturing and storing knowledge, an organization can make it available to all members, which can facilitate the sharing of ideas and stimulate creativity.
- By encouraging the sharing of knowledge, an organization can create an environment that fosters collaboration and promotes the exchange of ideas. This can lead to the generation of new ideas and solutions.
- By providing access to a wide range of information and resources, an organization can enable employees to learn and grow, which can increase their capacity for innovation.
- By continuously learning and adapting to new information, an organization can stay up-to-date and ahead of the curve, which can lead to the development of new products, services, and processes.
Overall, effective knowledge management can help organizations tap into the collective knowledge and expertise of their employees, leading to increased innovation and improved performance.