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The more you share the more you kno... Taking the gap leaves big hole... Service that is more than just pretty p... Ready to tap Internet's potential... All set to become a major force... Get in the swing with Ernie ... Hired guns taking aim at business target... Vital role for information provider... Turning couch potatoes into mouse potato... Interim plan, lasting succes... Downsizing not always up to the require... Taking the guesswork out of productio... The firm which took Toco's bull by the h... Fads dropped in favour of fact... Companies still keen to consul... |
The more you share the more you knowCHINESE Walls in some organisations are so impenetrable that the chief executive often has no idea what projects staff are working on. In some banks, for example, financial engineers working on a structured finance project keep their methodology a closely guarded secret. Knowledge is regarded as personal rather than organisational capital, so that when a staff member leaves the organisation, the knowledge and methodology goes with him and is lost to the company. Some banks have had their entire mergers and acquisitions or structured finance teams ripped out by competitors offering juicier compensation schemes. This poses a huge risk to revenue and profits and is seldom considered part of a bank's normal risk management procedures. This, however, is changing. Staff incentive schemes in future may depend not only on performance and duration of service, but the sharing of hard-won knowledge. There has to be a broad transfer of skills within an organisation to ensure its survival, and managers should be compensated not so much on what they know, but how well they share it, says Gerhard Human, managing partner of Price Waterhouse Management Consulting Services (PWMCS). Hiring outside consultants is one way of overcoming the knowledge deficit. Consultants provide insight and market intelligence not normally available to client companies. Knowledge of customers, markets, business processes and competitors can mean the difference between business success and failure. Knowledge management may be a new buzz word in the consulting industry, but PWMCS has been offering this service for more than six years. "What is known about customers, competitors and operations, and how this knowledge is used, can create a competitive advantage that will differentiate an organisation from its competitors," says Human. "The big challenge for businesses is how to get useful information to people in the organisation as fast as possible." Information systems incorporating data mining allow computers to sift through multiple databases for patterns and relationships, some of them useless, some of them critical to future success. "Data mining will tell you what percentage of your clients live in what suburbs, how old they are; it will tell you about their lifestyle preferences and spending habits. With this information, companies are able to tailor their products and services to suit different market segments better," says Human. He says each assignment completed by PWMCS is entered into a knowledge data bank which can be used as a reference by the firm's consultants around the world. "Similarly, we have access to assignment reports written by our colleagues overseas. So if we have a client here who has a particular problem with, say, distribution, we can refer to our global database to see how this problem was solved elsewhere, and what the results were." Huge amounts of money are being spent by companies on information systems in an attempt to improve the information flow - and hence decision-making - throughout the organisation, but the results often fall short of expectations, says Human. The firm's four areas of specialisation are financial and cost management, supply chain management, market and customer management (which takes over where supply chain management ends off) and market intelligence. Globally, PWMC grew revenues by 24% in 1997 to $1,4-billion. The firm has 13 000 consultants worldwide, represented in all major cities on six continents.
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