"It’s not about the money" – why financial incentives for KM dont work

On the topic of  incentives for Knowledge Management, there are some interesting observations in this article from HR magazine in 2004

The article is a high level overview of KM, which although warning that KM is not about technology, still talks mostly about technology solutions (and which immediately equates knowledge management with information sharing). However there is this interesting couple of paragraphs on incentives.

Incentives must be used prudently. One international high-tech firm used contributions [to a knowledge base] to determine raises. Just before year-end evaluations, the system broke down with an overload of hastily composed submissions, many of them meaningless. 

There are less expensive and more effective ways to encourage information sharing. For example, 25,000 Xerox field service technicians around the world contribute to the company’s Eureka database of maintenance tips. The incentive is “to become known as a thought leader” or expert in the field, says [Carol Kinsey Goman, president of Kinsey Consulting Services, a human capital consulting firm in Berkeley, Calif]

Sandy Mauceli, a spokesman for Xerox, says: “Although financial rewards were tried by various organizations early in the Eureka program, that generally did not drive the intended result. The motivation for employees to submit Eureka tips is really the recognition by their peers of being able to solve the really difficult problems.”

This reinforces the message that linking financial rewards directly to knowledge publication results in an overload of poor quality material.

I was reminded of this a while ago, where someone from a large company told me of the effect of including the target of “contribute 10 items to the knowledge base” in each employees appraisal. In a company of over 100,000 staff this has led to the publication of a million items every year. With no system of knowledge synthesis, this surge of (usually irrelevant) material has totally swamped the system, with the result that nobody can find anything useful.

Financial incentives may have some merit in the very earliest stages of  KM, but very soon, paying people to publish knowledge will flood your system with trivia.