In a rapidly changing world, current success and future survival depend on constantly learning to do things differently and better. Knowledge is both the raw material that is the foundation for learning and the output from it, offering new opportunities and new sources of revenue. Arguably this means we would be neglecting our strategic responsibilities if we did not review organizational priorities in terms of the knowledge available to the business and focus our management and leadership practices on creating the conditions where knowledge can be used productively.

What Do We Mean by Strategic Priorities?

Even when you accept the importance of taking a knowledge perspective on the organization, it is still a challenge to prioritize time, attention, effort, and financial resources to improve the way knowledge delivers results. Often people tend to be more drawn to immediate task requirements and don’t sustain the longer term perspective required to join up areas of knowledge activity smoothly and seamlessly. There is an additional challenge too: judging the returns on investments in knowledge-related initiatives can be perceived as highly subjective because the link between action and result can be very diffuse and slow to become visible in any measurable way. Unlike other resources which are consumed with use, knowledge tends to increase the more it is used in different contexts; its impact is amplified through sharing. Both of these attributes create huge potential for value generation. However, the consequences of knowledge initiatives are often difficult to measure directly without considerable effort and focus. Careful thought is needed to make evident the connection between knowledge initiatives, the results they produce, and the ultimate impact that these have on something that matters to key stakeholders in the organization.

As an example, a knowledge initiative could involve investment to establish and maintain more effective networks of people across the organization. One consequence could be speeding up access to the knowledge needed to put together proposals for new business, resulting in higher quality and timelier bids. These can be judged as the immediate outputs of the investment; it is possible to quantify in hard financial terms the increase in bid to win rate, growth in sales, or profit generated as a consequence. However, the final step in any strategic assessment should be checking that this is a strategic priority for the organization. For example, if resources are really limited, have the knowledge-related initiatives addressed what matters most? Is it really the highest priority for the organization to win new business, as opposed to delivering an excellent service to existing customers? If both are important, have resources been distributed between initiatives to improve them appropriately?

Potentially valuable knowledge comes from many sources, not all of which lie within the organization itself. The people who work closely with the organization (through whatever form of contract or relationship) are the main source. However, tapping into knowledge from the outside world in terms of suppliers, customers, partners, competitors, and other players in the sector is essential to supplement this and to provide early signs of the need to evolve and change. Finally, embedded knowledge that helps make the organization productive and unique is also valuable. We should not ignore what is special and distinctive about the way the organization runs, from the use of technology to the design of effective processes, and from the way people are managed to the culture.

By understanding from the outset what knowledge makes a difference to organizational performance, you can focus limited resources on the things that will have the most impact and generate the most value. Initiatives could range from increasing access to knowledge in an area where there is obviously a gap, to improving the distribution of critical knowledge to those who need it when they need it, or even to intervening to protect certain knowledge from reaching competitors because of its unique value. Some knowledge may even need to be shared freely to influence the way thinking and practice evolves in the sector or industry in general; this can grow potential opportunities for everyone. However, it is the piecemeal approach to knowledge initiatives which fails to help organizations make more meaningful and informed strategic choices. Lack of a structured approach also means that it is easy to overlook vital areas in which a knowledge perspective would help achieve the organization’s strategic objectives.

How Do You Establish Them?

The starting point is to understand what makes the organization able to survive and thrive in the face of competition and external change. By viewing knowledge as a resource we can make choices about how far it can be characterized as valuable and how much investment should be targeted at developing, maintaining, and protecting it. However, this isn’t sufficient because we also need to determine the organizational capability to use that knowledge. How readily can knowledge flow around the organization and to and from the outside world? Do the management and leadership practices create the conditions to enable this to happen?

The two chapters in this section provide complementary approaches to help determine strategic priorities, as shown in Figure I.1. The first offers a way of mapping and evaluating valuable knowledge and the second includes a structure to evaluate the priority of key knowledge flows and whether they are working well or are blocked by certain barriers.

Figure I.1: A strategic approach to designing knowledge initiatives

The fact that both “value” and “knowledge” are not absolute ideas that everyone can agree on, means that it is best to involve as many interested parties as possible in these strategic explorations. Those who have a stake in the outcome of the investments need to contribute to the assessment, particularly if they are interested and have influence on what is allowed to happen or how the results are interpreted.

Although these two approaches will get you started, a completely predetermined, structured approach is not necessarily feasible or desirable. Opportunities arise to try things out; success stories emerge that can be used to bring attention to a different way of working; someone with enthusiasm creates a momentum around something that was unforeseen. All of these are the realities of a complex organizational environment and sufficient flexibility is needed to respond. The value in using these models and frameworks to structure thinking about the organization from a knowledge perspective is that it is easier to recognize these serendipitous opportunities and evaluate them relative to others already underway. The challenge is to use the approaches described here to shape rather than constrain thinking about strategic knowledge priorities.

The knowledge strategy will need to evolve as the organization becomes more collaborative and knowledge-sharing behaviours become embedded. Organizational priorities and external drivers also change continuously. Thinking about strategic priorities is an ongoing activity and using knowledge well in the organization needs to become a dynamic capability which is recognized and valued.

Key Questions to Ask Yourself

As you start to use the ideas in the next two chapters:

• Ask who needs to be involved to both ensure that you can make sense of the situation properly and so that there is buy-in to the proposals that are generated.
• Think about when you should do this structured thinking about knowledge priorities and how you can keep an up to date view of what matters and what has changed.
• Be clear about why you are trying to improve the use of knowledge in the organization. Keep close attention to the generation of value for the organization.