Knowledge Management and Innovation

What’s the link between Innovation and KM? Are they opposites? Are they the same? Are they two sides of the same coin? This post from the archives explores the relationship between the two.

• Knowledge management takes over from Innovation at the point where an idea becomes knowledge, which is when you first test the idea, and first gain experience from which you can learn. 

• Innovation takes over from knowledge management when there is no knowledge to fit your business need, and you need new ideas. Both knowledge management and innovation are (or should be) a response to problems. If the answer to solve the problem is known, then KM provides the tolution. If the answer is not known, then you need Innovation. 

• New ideas can often spring from old knowledge combined in new ways – the Remix approach to innovation. 

• Proactive innovation beats reactive innovation. Systems where employees volunteer innovative ideas are nowhere near as powerful as systems where planned conversations are held around work process. The Technical Limit process, for example, where work crews are led through a structured discussion seeking new approaches, often leads to step changes in performance. 

• Networked innovation is a favoured model. Bringing together a series of fresh minds can lead to breakthrough solutions. The more diverse the network, the more radical the innovations can be, and we have experienced this ourselves at innovation-focused peer assists. Networked innovation forms the core of our Business Driven Action Learning approach. 

• Both Innovation and KM need to sit within a single strategic umbrella, focused on organisational competence. This could be an Organizational Learning Strategy, for example. This strategy would map out the competence of the organisation, both current and desired, and map out its knowledge, both existing and missing. Missing knowledge, if it exists, can be learned or bought in, or created/innovated.

• Innovation and KM are both driven by challenge. If people are not challenged, they will do what they have always done, using the knowledge they already have. The best way to get someone to actively seek for knowledge (either through innovation or re-use) is to give them a challenge they don’t know how to solve. We saw this when studying innovation in the Innovene (Chemicals) process, where innovation was driven by the sales force making promises that were beyond current technology. Ford drove incremental innovation by continually decreasing operating budgets. BP drives innovation by promising a continuous improvement in operating efficiency.  

• Innovation and KM only come into conflict when used inappropriately. Reuse of old knowledge is inappropriate if it can’t do the job. This is known in English as “flogging a dead horse”. Innovation is a waste of time if sufficient knowledge already exists. This is known as “reinventing the wheel”. See the discussion here. 

Perhaps the greatest waste of all is when great ideas are lost because organisations fail to manage their knowledge holistically. Our South African colleague Ian remembers a classic example that demonstrates why it is important:

 ‘The importance of managing knowledge was highlighted during the 1990s in De Beers. Ilana, a young metallurgist, was given a project. Ilana found the solution in a visionary internal report written in 1971 – an idea that appeared before its time. The innovative solution radically improved diamond recoveries and cut costs – the new technology was rapidly deployed across the group’.