What is Knowledge Management and Why is it Important to Your Business?

What is Knowledge Management?

Knowledge is power. From early childhood, humans are naturally drawn to learn and build upon previous findings. The thirst for new knowledge is an innately human desire that has never diminished, regardless of how much society has evolved. With smartphones and digitization, information is now more readily available than ever before. It's no wonder why so many people are distracted by online data.

The digital age has overwhelmed us with so much information that it's hard to sift through and understand. Thankfully, new digital tools can organize and systemize much of this data so users can easily understand and process it. Nobody has perfected this process as well as the business community. Professionals refer to this as knowledge management.

So, what exactly is knowledge management? Knowledge management is a practice that integrates identifying, collecting, evaluating, finding, and delivering critical information. A management system optimizes a company's productivity and safeguards data within the business.

The overall goal is to create a culture that values learning and increasing one's expertise in a subject. This is particularly critical when it comes to onboarding processes or training programs. Every industry from restaurants to manufacturing to healthcare uses some type of management process to handle organizational knowledge.

Types of Knowledge in Knowledge Management

To better understand knowledge management and management systems, it helps to know the main types of information. Employees need access to all of these types of data to optimize organizational learning. These include -

• Tacit Knowledge - Intuitive knowledge that is more difficult to codify. Collective knowledge a person gains through specific experiences. For example, a sales leader may explain his best practices for reaching customers, which are not explicitly in a training manual.
  
• Explicit Knowledge - Data that is easy to codify and teach. Typically includes step-by-step instructions that are easy to write down. For example, a server may teach a new team member how to prepare food for the next shift.
  
• Implicit Knowledge - Individual learns skills from applying explicit knowledge to a particular situation. For example, a new hire uses the steps the server gave him to begin prepping food.

Why is Knowledge Management Important?

Knowledge management is critical because it makes information easily accessible and enhances the overall company culture. As a result, organization knowledge improves employee efficiency and optimizes managerial decision-making.

When all team members have access to knowledge management systems, tools, and expertise, there is a healthier workforce. Workers are capable of making split-second choices because they have the right information at the right time. Employees can also share knowledge with others, which optimizes training, collaboration, and internal relationships.

A culture of innovation occurs as a result of sharing knowledge. Customers benefit because they have access to a higher quality of service and more experienced employees. The company benefits because workers are less inclined to quit when they feel equipped to perform their jobs. As a result, turnover decreases, and morale improves.

The more information technology there is, the more important knowledge management software becomes. With a more competitive marketplace, companies must brand themselves as intelligent, versatile, and innovative. A good set of content management systems and a sound knowledge management process provide the necessary foundation for that to occur. Ultimately, a knowledge management solution produces -

• A more efficient company culture
• Improved decision-making across the organization
• Increased collaboration
• A workplace that values sharing knowledge and using knowledge
• A workplace that optimizes and utilizes knowledge management processes and knowledge management tools to streamline knowledge creation and ensure information sharing across organization
• Optimized employee onboarding and training procedures
• Improved employee morale and lower turnover due to a good knowledge management strategy and set of management tools

What is a Knowledge Management System?

Organizations use different types of management tools to optimize and acquire new knowledge while ensuring authorized individuals can access it. This is particularly true when it comes to training processes, company procedures/policies, and company news. The type of information management platform will depend on the company's needs and priorities. Managers should provide excellent training so workers know exactly how to navigate all knowledge management solutions. This will streamline and hasten knowledge sharing and ensure it's easy to share information as required. Some common examples include -

• Customer Relationship Management Systems (CRMs) - Enable marketing, sales, and CSR teams to manage and track client data throughout any interactions.
• Learning Management Systems - Effective tools to manage employee training and onboarding processes. Self-service solutions allow workers to train themselves. Managers can use a set of checks and tests to ensure they are learning and meeting knowledge expectations.
• Online Knowledge Base - Searchable directory of all available products and how they can be used. Good for IT departments to troubleshoot problems and find answers to questions.
• Document Management Systems - Use of software to track, store, and manage all digital documents within an organization. Provides authorized access to specific users.

Key Takeaways of Knowledge Management

In conclusion, here is what to know about knowledge management -

• Knowledge management tools strengthen internal knowledge, improve the organizational culture, create better employees, and make happier customers.
• Effective knowledge management consists of tacit knowledge, explicit knowledge, and implicit knowledge.
• Knowledge management has several benefits. These include a more efficient company culture, improved decision-making, increased collaboration, more information sharing, better use of applications, improved employee onboarding, optimized training procedures, and better morale/lower turnover.
• Knowledge management systems include customer relationship management systems, learning management systems, online knowledge bases, and document management systems.