It is a universal challenge for large organizations: the larger and more segmented the company, the harder it is to match its people to its problem. This Idea looks at how internal ‘knowledge markets’ can facilitate information sharing within large organizations; helping employees locate expertise and matching knowledge seekers with knowledge sources.
Truly democratizing knowledge requires an open organization where employees can deliberate, argue, compete and collaborate horizontally across fields of expertise. One possible solution to this end is the internal knowledge market. An internal knowledge market is a protected environment where users trade their knowledge via price mechanisms. Though such markets have existed in different forms for years, their use to facilitate knowledge transfer inside organizations is relatively new.
The internal knowledge market can be a forum within an organization that matches knowledge seekers with knowledge sources (for example, branch offices and headquarters, or novices and experts). They aren’t for everyone, especially organizations with insufficient scale. As a business grows, however, working knowledge gets distributed across branch offices and divisions, and the flow of information stagnates. These markets can open the flow of knowledge back up.
The research cited here took place in four phases, interviewing more than 30 companies and studying five in-depth (IBM, Cisco Systems, HP, Protiviti and Siemens). Also under review were the sources of internal knowledge market failures, in order to propose design strategies for resolving them, develop benchmarks, and build an internal knowledge market prototype.
By learning from what has worked well (and what has not) in existing internal knowledge markets, managers can develop an effective knowledge market design to suit their own organization.
To design and maintain an effective internal knowledge market, take the following three-fold framework:
Well-designed internal knowledge markets can provide a powerful set of tools to help large companies address the problems they face in accessing the wealth of dispersed information and talent. However, introducing an internal market opens a company to new forms of governance and creates completely new roles for those who would manage expertise. Executives must not only change their tools and how their people interact, but also change themselves. The true test of internal market adoption will be whether companies begin to use them for critical issues, not just fringe areas.
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