Date   

Re: Weighing the benefits of productivity improvements #value

Bill Ives <iveswilliam@...>
 

I agree with Andrew on the time savings ROI - It is meaningless. It does not go to the bottom line. What are the people going to do with the time savings? leave early?  It is more effective to tie the performance improvement to bottom line measures such as increased productivity on factor x or less money spent on factor Y.  The time savings ROI has been around for a long time and given KM a bad name.  I am surprised to see it still being used.  Sorry to not agree but this hits a hot button for me (it has been around for so long) and I am a big believer that real measurable savings can be found from KM or enterprise search. Finding it is a good test that we are employing the initiatives to address business issues.   Bill


On Aug 14, 2008, at 12:25 AM, Andrew Gent wrote:


Yao and Bill,

With improved enterprise search ... knowledge workers can reduce the amount of the time spent on search ... a saving 10% of the time (1 hour per week) can be translated into potential saving of $1,425 a year per worker.

I am going to play devil's advocate here. Not because I don't like your arguments. I have used almost the exact same argument myself. But I have also had the following discussions with senior business managers. The conversation goes something like this:

  • We just spent $XXX thousand dollars last year on a new search engine. Where are the savings from that improvement?
  • 1 hour a week is 2.5% of a 40hr week. Show me where I am getting a 2.5% increase in production or performance? (Not theory but actual improvements in the bottom line.)
  • "... a saving of 3,000 x $1,425 = $4,275,000" $4 million return on an investment of what? -- say 4 people for a year, approximately $500K -- that's an ROI of 700% in one year. Who are you kidding? Real ROI for things like SAP are 200-400% over a 6 year period, not even breaking even for 2-3 years. I don't believe it.
Now having said all that, it occurs to me that there are two types of conversation like this. The justify-your-program discussion with your direct manager and the justify-your-expenditure discussion with upper management. What I have just described is the latter, which is why justifying KM programs is so difficult. Saved time and unmeasurable performance improvements simply don't go over in budget discussions.

However, for justifying your program to your direct manager, the argument concerning saved time is important, because usually that person is also managing the people whose performance you will impact. So I would suggest three things for that discussion:
  • Keep the argument about saving time. This has meaning to that manager (since they directly manage employees such as yourself)
  • Don't bother getting into the theoretical monetary savings, because it is meaningless. That manager is not going to see that money, so it is a waste of time.
  • As Stan has suggested before, use multiple arguments. Argue the saved time. Also provide supporting evidence -- emails, forum postings, performance review input -- from people who say your program has helped them save time or be more effective. It is best to  collect this information on an ongoing basis so you have it handy when you are asked to justify your program. It is hard-to-impossible to collect in a hurry at the last minute.
Best,

Andrew Gent
ajgent@yahoo.com
(603) 888-0370


 




Re: Weighing the benefits of productivity improvements #value

Peter Dorfman <pdorfman@...>
 

All of which suggests a simple best practice: Build in your internal marketing
for the initiative, whatever it is -- and this includes a constant commitment to
getting end users to speak up as advocates/references/case study subjects for
whatever you've given them -- from DAY 1. Do NOT expect the benefits to be
self-evident, and don't be stuck playing catch-up a month before the next budget
review.

Peter Dorfman

On Thu Aug 14 0:25 , Andrew Gent <ajgent@...> sent:







Yao and Bill,

With improved enterprise
search ... knowledge workers can reduce the amount of the time spent on search
... a saving 10% of the
time (1 hour per week) can be translated into potential saving of $1,425 a
year per worker.

I am going to play devil's advocate here. Not because I don't like your
arguments. I have used almost the exact same argument myself. But I have also had
the following discussions with senior business managers. The conversation goes
something like this:

We just spent $XXX thousand dollars last year on a new search engine. Where are
the savings from that improvement?1 hour a week is 2.5% of a 40hr week. Show me
where I am getting a 2.5% increase in production or performance? (Not theory but
actual improvements in the bottom line.)"... a saving of 3,000 x $1,425 =
$4,275,000" $4 million return on an investment of what? -- say 4 people for a
year, approximately $500K -- that's an ROI of 700% in one year. Who are you
kidding? Real ROI for
things like SAP are 200-400% over a 6 year period, not even breaking even for
2-3 years. I don't believe it.
Now having said all that, it occurs to me that there are two types of
conversation like this. The justify-your-program discussion with your direct
manager and the justify-your-expenditure discussion with upper management. What I
have just described is the latter, which is why justifying KM programs is so
difficult. Saved time and unmeasurable performance improvements simply don't go
over in budget discussions.

However, for justifying your program to your direct manager, the argument
concerning saved time is important, because usually that person is also managing
the people whose performance you will impact. So I would suggest three things for
that discussion:
Keep the argument about saving time. This has meaning to that manager (since
they directly manage
employees such as yourself)Don't bother getting into the theoretical monetary
savings, because it is meaningless. That manager is not going to see that money,
so it is a waste of time.As Stan has suggested before, use multiple arguments.
Argue the saved time. Also provide supporting evidence -- emails, forum postings,
performance review input -- from people who say your program has helped them save
time or be more effective. It is best to collect this information on an ongoing
basis so you have it handy when you are asked to justify your program. It is
hard-to-impossible to collect in a hurry at the last minute.Best,

Andrew Gent
ajgent@...
(603) 888-0370










Re: Weighing the benefits of productivity improvements #value

sjagannath@...
 


Hi Yao,

This is a wonderful topic. Around an year time back, while I developed the business case for instituting an enterprise search (certainly as part of KM initiative) I used same argument. Presented similar numbers of savings/year. But, with this calculation we are probably assuming the search would always provide relevant results...
My experience, it does not in many cases!! If in case it does capturing the same is almost an impossible task. How many of us have contributed information for formulating case study or rated an relevant article? Guess it is very difficult to have that discipline built within an organization to provide feedback/rating.

Andrew, Your thought process is absolutely right that a small search initiative cannot quantify million dollars to the bottom line... wonderfully substantiated with ERP example consuming more time than just 1 - 2 years for showing benefits.

Hence, am sailing in the same boat as Yao & looking forward for some more meaningful metrics, where dependency on feedback is relatively less.

Regards,
Srinivas P Jagannath



Re: Weighing the benefits of productivity improvements #value

Andrew Gent <ajgent@...>
 

Yao and Bill,

With improved enterprise search ... knowledge workers can reduce the amount of the time spent on search ... a saving 10% of the time (1 hour per week) can be translated into potential saving of $1,425 a year per worker.

I am going to play devil's advocate here. Not because I don't like your arguments. I have used almost the exact same argument myself. But I have also had the following discussions with senior business managers. The conversation goes something like this:

  • We just spent $XXX thousand dollars last year on a new search engine. Where are the savings from that improvement?
  • 1 hour a week is 2.5% of a 40hr week. Show me where I am getting a 2.5% increase in production or performance? (Not theory but actual improvements in the bottom line.)
  • "... a saving of 3,000 x $1,425 = $4,275,000" $4 million return on an investment of what? -- say 4 people for a year, approximately $500K -- that's an ROI of 700% in one year. Who are you kidding? Real ROI for things like SAP are 200-400% over a 6 year period, not even breaking even for 2-3 years. I don't believe it.
Now having said all that, it occurs to me that there are two types of conversation like this. The justify-your-program discussion with your direct manager and the justify-your-expenditure discussion with upper management. What I have just described is the latter, which is why justifying KM programs is so difficult. Saved time and unmeasurable performance improvements simply don't go over in budget discussions.

However, for justifying your program to your direct manager, the argument concerning saved time is important, because usually that person is also managing the people whose performance you will impact. So I would suggest three things for that discussion:
  • Keep the argument about saving time. This has meaning to that manager (since they directly manage employees such as yourself)
  • Don't bother getting into the theoretical monetary savings, because it is meaningless. That manager is not going to see that money, so it is a waste of time.
  • As Stan has suggested before, use multiple arguments. Argue the saved time. Also provide supporting evidence -- emails, forum postings, performance review input -- from people who say your program has helped them save time or be more effective. It is best to  collect this information on an ongoing basis so you have it handy when you are asked to justify your program. It is hard-to-impossible to collect in a hurry at the last minute.
Best,

Andrew Gent
ajgent@...
(603) 888-0370


 


Re: Weighing the benefits of productivity improvements #value

Bill Dixon
 

Hello Yao,
 
I was asked a similar question this morning and have also been formulating a response. 
 
I like the general approach you have taken in the draft of your article.  Without getting in too much detail, you do a good job describing one of the potential benefits of KM.  In our environment, KM can also help mitigate risk.  By leveraging not only best practices but by avoiding worst practices, we avoid making potentially costly mistakes over an over again.  The impact on the business can be significant.
 
I am adapting Yelden and Albers (2004) (http://www.tlainc.com/articl69.htm) approach to establishing business cases for KM initiatives to our environment.  They advocate the following framework for developing business cases around KM initiatives:,

1.      Strategy assessment

2.      Knowledge audit

3.      Knowledge and business strategy alignment

4.      Opportunity identification

5.      Value, business benefits, and evaluation

6.      Risk reduction techniques

"In order to make a successful justification, it is necessary to clearly identify all the options available with the associated risks involved with each choice.  Furthermore, it is required to first identify and separate the benefits of a given initiative, then determine its value to the firm, before proceeding to infer an associated cost and expected return for undertaking the effort.  Clearly delineating the expected hard and soft benefits of each aspect of the initiative will greatly aid in effectively justifying its need."

I will send you a copy when I am finished. 

Thanks for sharing your draft.

Regards,

Bill Dixon,

Ernst & Young, LLP

 
 

----- Original Message -----
Sent: Wednesday, August 13, 2008 10:16 AM
Subject: [sikmleaders] Weighing the benefits of productivity improvements

Hello KM peers, I am once again asked to justify what I am doing by associating my work in KM area to impact to business bottom lines such as hard-savings. This type of request must be common across KM and other collaboration related areas. It is a fair question but quite difficult to articulate.
 
Below is a short article I just wrote on how to measure the benefits of productivity improvements and I would like to hear what this group thinks on this topic (not only on workplace efficiency but also KM/Collaboration/Innovation etc). Thanks in advance!
 

One of the most significant challenges in today's knowledge work is to deal with explosion of "Information Overload". The saving of workers time in searching, accessing, and filtering the vast amount of information scattered across personal desktop, shared workspace, and enterprise repositories can be measured and potentially translated to hard-savings in workspace.

In the age of industry evaluation, we measure productivities by yields and through-put of the workers on the assembly lines. It is a bit harder to measure the productivities in the information age as knowledge work performed today as less mechanical and procedural in nature. Some type of work such as research and development can be measured by number of patents, number of design iterations, and product development lead times.

As an example, according to an IDC study, a knowledge work spends around an average of 9.5 hours per week searching for information. Based on the average salary plus benefits of $60,000/year from Department of Labor (2005), this would translate to $14,251.90 a year per worker. With improved enterprise search, there are two possible out-comes depends on the nature of the work. The knowledge workers can reduced the amount of the time spent on search for information. Or the they might actually spent the same or even more time on searching but discover more relevant information which results in improvements in the quality of the job deliverables. In the first case, a saving 10% of the time (1 hour per week) can be translated into potential saving of $1,425 a year per worker. If we only effected a 10% of the knowledge worker population at Ford, that would a saving of 3,000 x $1,425 = $4,275,000. Can this be translated to reduced workforce in term salary and benefits paid? Probably not, but we can safely say it would positively impacted the business bottom line indirectly through better work through-put, increased quality, and improved morale (reduced stressed at work). The second scenario is much harder to measure. If a research scientist can find a new connections among previously unknown facts due to improved search performance, the impact of productivity gain can be measured by new patents and innovate products that changes the competitive landscape in the industry. As we can tell, the benefits of various technologies on productivities can be measured directly through the amount of time saved. But the impacts are far more indirect and potentially very significant.

As you can see, there is a lot of "IF" statements. To a large degree, The numbers are anecdotal but yet very convincing to reflect the order of magnitude of the positive impact. Like other strategic investments, such as Knowledge Management, the returns are mixed with multitude of other internal and external factors when it comes to impact on bottom line. In a business environment of doing more with less, productivity improvement is not a "nice to have" but a basic element for survival.


Weighing the benefits of productivity improvements #value

Yao Ge
 

Hello KM peers, I am once again asked to justify what I am doing by associating my work in KM area to impact to business bottom lines such as hard-savings. This type of request must be common across KM and other collaboration related areas. It is a fair question but quite difficult to articulate.
 
Below is a short article I just wrote on how to measure the benefits of productivity improvements and I would like to hear what this group thinks on this topic (not only on workplace efficiency but also KM/Collaboration/Innovation etc). Thanks in advance!
 

One of the most significant challenges in today's knowledge work is to deal with explosion of "Information Overload". The saving of workers time in searching, accessing, and filtering the vast amount of information scattered across personal desktop, shared workspace, and enterprise repositories can be measured and potentially translated to hard-savings in workspace.

In the age of industry evaluation, we measure productivities by yields and through-put of the workers on the assembly lines. It is a bit harder to measure the productivities in the information age as knowledge work performed today as less mechanical and procedural in nature. Some type of work such as research and development can be measured by number of patents, number of design iterations, and product development lead times.

As an example, according to an IDC study, a knowledge work spends around an average of 9.5 hours per week searching for information. Based on the average salary plus benefits of $60,000/year from Department of Labor (2005), this would translate to $14,251.90 a year per worker. With improved enterprise search, there are two possible out-comes depends on the nature of the work. The knowledge workers can reduced the amount of the time spent on search for information. Or the they might actually spent the same or even more time on searching but discover more relevant information which results in improvements in the quality of the job deliverables. In the first case, a saving 10% of the time (1 hour per week) can be translated into potential saving of $1,425 a year per worker. If we only effected a 10% of the knowledge worker population at Ford, that would a saving of 3,000 x $1,425 = $4,275,000. Can this be translated to reduced workforce in term salary and benefits paid? Probably not, but we can safely say it would positively impacted the business bottom line indirectly through better work through-put, increased quality, and improved morale (reduced stressed at work). The second scenario is much harder to measure. If a research scientist can find a new connections among previously unknown facts due to improved search performance, the impact of productivity gain can be measured by new patents and innovate products that changes the competitive landscape in the industry. As we can tell, the benefits of various technologies on productivities can be measured directly through the amount of time saved. But the impacts are far more indirect and potentially very significant.

As you can see, there is a lot of "IF" statements. To a large degree, The numbers are anecdotal but yet very convincing to reflect the order of magnitude of the positive impact. Like other strategic investments, such as Knowledge Management, the returns are mixed with multitude of other internal and external factors when it comes to impact on bottom line. In a business environment of doing more with less, productivity improvement is not a "nice to have" but a basic element for survival.


Re: Update from Stephanie Barnes and Missing Puzzle Piece Consulting #personal

sswarup44 <sswarup44@...>
 
Edited

Congrats Stephanie,
All the best in your new position.


Sanjay Swarup
Program Manager KM
ManTech International


Re: My New Position #personal

Cornejo Castro, Miguel <miguel.cornejo@...>
 
Edited

Will be looking forward to what you do in that area, too :-).

Best regards,

Miguel


Re: My New Position #personal

Tom Short <tman9999@...>
 

Thanks for the tip, Matt. Will definitely be checking that out -
especially keeping in mind your feedback. Am curious to know more...
Tom

--- In sikmleaders@..., Matt Moore <laalgadger@...> wrote:

Tom,

Congrats on the new role! Someone really needs to give Gartner's
coverage of collaborative software a kick in the pants - and I hope
it's you. Forrester have the edge on you guys at the moment.

Cheers,

Matt


Re: My New Position #personal

Tom Short <tman9999@...>
 

Thanks, Valdis. Re competitors, don't know yet. I think Gartner would
like to think no one :-) That's based on the business model of
coupling our benchmarking research and analyst research with our
client needs and consulting offerings. No one else - not even IBM or
the Big 4 - have that ability. And Consulting is still relatively
small at Gartner compared to the aforementioned firms - orders of
magnitude smaller. So it's going to be interesting to see how that all
plays out.

--- In sikmleaders@..., Valdis Krebs <valdis@...> wrote:

Tom,

Congrats on your new position!

Who are your key competitors? The strategy arms of IBM GS, Accenture,
etc?

Valdis


Re: My New Position #personal

Matt Moore <laalgadger@...>
 

Tom,

Congrats on the new role! Someone really needs to give Gartner's coverage of collaborative software a kick in the pants - and I hope it's you. Forrester have the edge on you guys at the moment.

Cheers,

Matt


Update from Stephanie Barnes and Missing Puzzle Piece Consulting #personal

Stephanie Barnes
 

Hi Everyone,

I hope you are all well and enjoying the summer (or winter if you are
in the Southern Hemisphere)! :)

This email is to share some great news with all of you. After almost
5 years out on my own, doing knowledge management consulting, I have
accepted a full-time position with a consulting company here in
Toronto, called Ideaca Knowledge Services. I am a senior consultant
doing project management and senior business analysis activities in
their portals and collaboration practice. The practice focuses on
enabling business processes with portals and collaboration
technology, recognizing that technology is an enabler, and that
people and process are key elements in the success of any technology
initiative. From a technology perspective, the portals and
collaboration team focuses on SharePoint, but because technology is
only one component of what we do, we get to do other things than just
technology, like strategy and roadmaps. :)

It's a great fit for my existing clients because now I have a whole
pool of people to get involved in projects that were too big for me
to do on my own or for when I was too busy to do it all, and it's a
great fit for me, because I can focus on delivery of consulting and
not have to split myself between business development and delivery,
not to mention that I don't have to do all the administration
activities anymore. :)

My Missing Puzzle Piece Consulting business and webpage will remain
alive, just on the sidelines for now, so you can continue to contact
me through that route or, my new contact information at Ideaca is in
my signature below.

I hope to maintain and continue to grow my network in my new role,
and I look forward to hearing from any of you struggling with
SharePoint or other knowledge technology implementations. Ideaca has
a proven and balanced (people, process, and technology, as well as
business-IT alignment) strategy to being successful in the knowledge
services consulting domain and I am excited about this next step in
my career.

Best Regards,
Stephanie

Stephanie Barnes - Senior Consultant
T 416.961.4332 ext/vm 5193| F 416.673.5165 | C 416.522.5126 |
stephanie.barnes@...

Ideaca - Toronto | Edmonton | Calgary | Vancouver | www.ideaca.com
2007 Global Partner of the Year – Information Worker Solutions
2006 Global Partner of the Year – Microsoft Business Solutions
Technology Innovation
fromStrategytoSolution


Re: My New Position #personal

Valdis Krebs <valdis@...>
 

Tom,

Congrats on your new position!

Who are your key competitors? The strategy arms of IBM GS, Accenture, etc?

Valdis

On Aug 8, 2008, at 12:59 PM, Tom Short wrote:

Hello all - today marks my first week in my new job with Gartner
Consulting. We do technology and business strategy engagements that
leverage Gartner's world-class research and analysis to help clients
address strategic business issues. I'm aligned with our San Jose
office here in the Bay area, and will be focusing on developing new
business in our High Tech & Telecom Practice. There seems to be a lot
of interest around collaboration, innovation and general KM-related
themes, so I'm hoping that part of my background will be useful and
valued - we shall see.
best,
-Tom Short
tom.short@...
+1-916-414-2244


------------------------------------

Yahoo! Groups Links



My New Position #personal

Tom Short <tman9999@...>
 

Hello all - today marks my first week in my new job with Gartner
Consulting. We do technology and business strategy engagements that
leverage Gartner's world-class research and analysis to help clients
address strategic business issues. I'm aligned with our San Jose
office here in the Bay area, and will be focusing on developing new
business in our High Tech & Telecom Practice. There seems to be a lot
of interest around collaboration, innovation and general KM-related
themes, so I'm hoping that part of my background will be useful and
valued - we shall see.
best,
-Tom Short
tom.short@...
+1-916-414-2244


Re: Framework/Methodology to build niche domain capabilities #expertise #methods

vs_shenoy <vs_shenoy@...>
 
Edited

Srinivas,

I agree with Al about there not necessarily being a framework or
model, as different groups view KM in different perspectives. You
might find it useful to consider the ideas you have and conceptualize
these as a framework that works best for your organization, rather
than using a cookie cutter approach.

I have tried approaching this from a process perspective, and used
this as the first step in knowledge discovery. When you begin
discovery, you will be surprised who the real SMEs are, who your
champions are and who/what barriers are to creating a creative,
knowledge sharing environment. It can also identify closed loops,
silos and even knowledge drains. The questions of what, why, when, how
can then be used to fill gaps you identify.

I would advise against considering a software solution and then
working backwards to understand where your processes would fit in.

Thanks,
Vinod

PS. The knowledge domain paper was an excellent read.


Re: Framework/Methodology to build niche domain capabilities #expertise #methods

sjagannath@...
 


Dear All,

Thought I could express in different words again. Here is my try....

We have a many groups supporting technology operations & at this point would like to improve on domain knowledge capabilities/competency.

As Al Simard suggests, its a wonderful idea to collate information from experts, formulate training programs & disseminate through various collaborative techniques. But the experts are not easily accessible. Given this scenario, may be alternative is to build domain capabilities through secondary research (from internet) as the key source & may be other means.
For which any methodology/framework would help, such that it could be a focused effort to build niche competency.

I understand its vague requirement/thought, but guess most of us are living with the same fact!

Regards,
Srinivas






"Albert Simard"
Sent by: sikmleaders@...

08/05/2008 07:25 PM

Please respond to
sikmleaders@...

To
cc
Subject
Re: [sikmleaders] Framework/Methodology to build niche domain        capabilities






Srinivas -

 
I don't necessarily have a methodology or process framework, but I've used KM techniques (group dialogue, collaboration) to extract tacit knowledge from groups of experts to generate systems models for knowledge services and model development.  The former is published; the latter is still under way.
 
Al Simard
 
Al Simard
 
 





Re: Framework/Methodology to build niche domain capabilities #expertise #methods

Albert Simard <simarda@...>
 

Srinivas -
 
I don't necessarily have a methodology or process framework, but I've used KM techniques (group dialogue, collaboration) to extract tacit knowledge from groups of experts to generate systems models for knowledge services and model development.  The former is published; the latter is still under way.
 
Al Simard
 
Al Simard
 
 
 
ve )


Re: Framework/Methodology to build niche domain capabilities #expertise #methods

steven.wieneke@...
 
Edited

Srinivas,

I have attached a paper that Karla Phlypo-Price and myself wrote in 2003 that may be helpful. The content for the most part is time independent.
https://sikm.groups.io/g/main/files/The_KM_Domain_October_2003.pdf

Regards,

Steven Wieneke
Global Technical Memory
& Closed Loop Learning
Global Engineering
General Motors Corporation
steven.wieneke@...


Framework/Methodology to build niche domain capabilities #expertise #methods

sjagannath@...
 


Dear All,

Any framework/methodology to improve niche domain knowledge capabilities of a group?

Most answers would revolve around building or developing body of knowledge, training materials, devising an certification program etc.
To probably build these body of knowledge/training material do we have a specific framework or methodology that could be followed.

Any material, best practice or internet resources would be of great help.

- Srinivas


Re: New poll for sikmleaders - Create a wiki page? #wikis #poll

Peter Dorfman <pdorfman@...>
 

I have used WikiSpaces and admire its simplicity.

Peter Dorfman

On Tue Jul 29 10:59 , "Albert Simard" sent:












Oky Doky

Just to get something going, I set up a page on Wikispaces. It seems
more intuitive than Wikidot.com (which also has firewall issues). On first
glance, It doesn't seem as powerful as Google wiki, but I can set it up
from work but outside of my work domain (our !@#$%^
firewall again!)

http://knowledge-life-cycle.wikispaces.com/

I seeded the page with content from the Northwest KM group site, which
doesn't have provisions for editing as in a wiki (I missed the bottom
paragraph!). Since someone already has an outline, let's begin
there.

Everyone can view the site, but only members can edit it. Although
there is a provision to invite people to join, I don't have all the
necessary e-mail addresses, so let's see how it works when you request
membership.

Anyone from SIKM with an interest in life-cycle management for knowledge is
invited to participate.

Just for clarification. There should be only one SIKM wiki containing
all our pages. If this doesn't end up as that site, I'll gladly move
whatever content we have to the "endorsed" site.

Al Simard

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