Project Management Institute

20/20 foresight




  • img   Electronic systems can help firms capture knowledge from past projects to save time and money while improving the judgment of team members.
  • img   If an organization can pull its wisdom together, it can learn from slips and successes alike.
  • img   A simple structure and search capabilities allow users to get the information they want.
  • img   A safe culture makes the effects of sharing positive, not punitive.

img Capturing knowledge is big business. Research firm International Data Corp. indicates that companies spent $2.7 billion on new knowledge management systems in 2002, and analysts expect spending to rise to $4.8 billion by 2007. They also estimate that Fortune 500 companies lose $31.5 billion each year because they don't share knowledge. A system doesn't need to be overly complex, as the scope, sophistication and cost of systems vary. The trick is to find a database that people will embrace and use to their advantage.

For any consulting firm to be successful, it's critical that they do a great job of collecting learning. We do not do cookie-cutter projects, but they do draw from common topics and common learning.


For example, Kevin Metcalfe, an engineer with London-based Transdevelopment, can operate just about anywhere in the world because his firm maintains an extensive online library. With documented and accessible lessons learned information, Mr. Metcalfe and Transdevelopment's project teams can save money and time and can work more effectively on current and future challenges.

More important that technical sophistication, today's electronic knowledge management systems must be easily accessible, as dispersed team members report information on their global projects at different times and in different ways. “You couldn't handle it if it was all on paper,” Mr. Metcalfe says. “And it's no use if it is in people's heads because then you have to know which head to talk to.”


Foundations and Functions

Transdevelopment's knowledge management system is simple, as befits a small firm that specializes in one type of project. “We tend to put everything together in a project folder,” Mr. Metcalfe says. A network user scrolls through the directory to find the relevant designs, photographs and notes.


The next step on the knowledge ladder consists of two similar Internet applications, Weblogs and wikis. With a Weblog, often shortened to blog, team members can contribute notes, information and files in chronological order. They cannot update information that is already on the site. A wiki—essentially a simple cooperative Web community site—is a similar application, but it allows for greater organizational flexibility, as the information doesn't have to be arranged chronologically. A wiki also lets team members update information already on the site.

Both offer inexpensive means of simplifying project communications. The announcement features eliminate both group e-mail messages and endless “reply all” responses. Both wikis and Weblogs can be archived so that users can go back and follow the arc of a past project, but they take up less network storage space than e-mail with countless attachments.

At Transdevelopment, engineers use the project files to standardize elements in their building designs. The ship and rail depots that the company designs for automobile manufacturers have standard configurations, but the local subcontractors may find better ways to do things. For example, Mr. Metcalfe says that the rail transit sites have air systems installed to pump-up freight car brakes before the train's engine is coupled. These were custom-built for each site until Transdevelopment built one in Alabama. There, Air-Dynamic, Jacksonville, Fla., USA, made these systems off-the-shelf.

That information has now been stored so that the company's next rail-yard project, no matter where it is in the world, will include this standard feature. The project library “rarely saved us money, but it's often saved the clients money,” Mr. Metcalfe says. “That's better, because then they come back to us.”

No Deposit, No Return

Of course, the system use varies greatly with the size and structure of the firm. At Bain & Co., Boston, Mass., USA, consultants can go to an intranet repository called the Global Experience Center, or GXC. “Our business is knowledge,” says Bob Armacost, the company's director of knowledge management. “For any consulting firm to be successful, it's critical that they do a great job of collecting learning. We do not do cookie-cutter projects, but they do draw from common topics and common learning.”


You couldn't handle it if it was all on paper. And it's no use if it is in people's heads because then you have to know which head to talk to.

Kevin Metcalfe, Engineer, Transdevelopment, London, U.K.

two types

To tap the right information, you must understand that organizational knowledge falls into two main categories:

1 TACIT INFORMATION is in people's heads—the tricks, tips and judgment that accumulate over the years. In many cases, it could be written down and used, but that's not always possible. The information may be too sensitive to put into print, or it may be specific to one context. For example, many people only remember their gym locker combination when they are standing right in front of the locker, lock in hand.

2 CODIFIED KNOWLEDGE consists of words, files, facts and figures. It is information that already is in print, but it is useless unless it can be collected in one place and connected to the work that people do. It's not necessarily easier to get at than tacit knowledge because it is often disorganized.

Bain's staff can perform keyword searches to find white papers, case studies and other information from the firm's store of intellectual property. The GXC is updated regularly; every consulting team submits a one-page summary when an engagement closes. It includes a project description, a list of questions raised, the team members who worked on it and other related information. The system's earliest and most important contributors were the firm's most senior consultants, who set an example for the rest of the company. Mr. Armacost says that such visible support is critical; people will not use a system if management doesn't.

img To harness the power of tacit knowledge, Bain's GXC lists the name and contact information for every team member involved with each project. A consultant researching past practices can pick up the phone to get a human perspective on the situation. This helps people build networks within a very large organization while helping them apply historical lessons to their current client needs.

img The one-page description not only makes it easy for teams to contribute data, it also creates a manageable database. Mr. Armacost notes that one common error is trying to put too much information on the system. That clutters the database with lower value content so that effective searching is impossible. If project managers fail to get useful information out of a first search, they may write off the system. “If the content is not high quality, users will not get value out of it. It's not going to make an impact in their day,” he says.

Putting Facts to Work

With a data repository, a company can work more effectively and save money by learning from its past experience.

If we are project management professionals, then we ought to be self-observant. One of the best methods of self-observation is journaling.


At Stata Labs, San Mateo, Calif., USA, which develops spam-blocking and e-mail search tools, wiki archives guide software upgrades. Developers working on a new product release can see why a certain feature wasn't included in earlier versions or can follow the development of bugs. “They can easily process that because it's all in the wiki,” says Andy Stack, Stata Labs senior director of finance and operations. “You don't have to go trolling through your e-mail or hope that someone collected it in a spreadsheet somewhere.”

An accessible archive also reduces the cycle time when you bring in new contractors or team members, a common occurrence in a growing technology firm. That alone has saved Stata Labs time and money, Mr. Stack says.

Bain's GXC has been four years in the making, during which Mr. Armacost has learned many lessons. “If the culture does not support knowledge management, none of this will get off the ground,” he says. Unfortunately, fear keeps too many firms from learning from past successes. Special techniques devised by many employees set them apart from others, earning them professional kudos. If everyone in the firm knows these secrets for debugging code, organizing presentations or dealing with difficult clients, the special knowledge will become worthless at bonus time. If a project wrap-up includes a list of things that could be improved next time, a manager looking to make cutbacks might use that as evidence of poor performance. Is it any wonder that employees get nervous?


img Lack of trust “is fundamentally destroying the possibilities of knowledge management,” says Donna Fitzgerald, partner at Knowth Consulting, Kirkland, Wash., USA. Nevertheless, she believes that individuals who do not trust their employers still can take advantage of knowledge management tools. Ms. Fitzgerald recommends that these concerned consultants keep personal diaries of project successes and failures, on their own time, in their own house, using their own computers or office supplies. “If we are project management professionals, then we ought to be self-observant,” she says. “One of the best methods of self-observation is journaling.” This helps managers learn from their own mistakes and hone their judgment without jeopardizing their employment. PM

Ann C. Logue is a freelance writer based in Chicago. She has written for Barron's, The New York Times and The San Francisco Chronicle, among other publications.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI.




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