Measuring the value of KM Projects: Insights into Practical Issues

While many companies today are deeply investing in Knowledge Management (KM), they generally encounter substantial difficulties in measuring the value generated by those programmes. Actually, how KM-related costs and benefits can be effectively measured is still a puzzling problem both at the conceptual and operational level. This is due to the substantially intangible nature of such activities, as well as to their very long-term horizons. Since KM programmes are set up with the purpose to contribute to the business, trying to measure their value is absolutely necessary, not only for monitoring their effectiveness but also for successfully managing and allocating resources. An evaluation is also required to demonstrate the results achieved, which is essential to maintain the support and commitment by the top management. In literature, several KM performance evaluation methods and approaches have been proposed. However, these methods are still far from becoming an established practice. They are very heterogeneous, and often derive from techniques formerly developed for other goals, and combined with ad hoc elements; also, they are often poor in usability. In point of this, the paper aims at discussing such issues by placing them in a practical context. First, the literature on KM assessment is briefly reviewed, and the main methods that are currently in place are classified, with the purpose to stress their key features seen from a user perspective. Then, the practical experience of a multinational company is examined to describe the real problems that knowledge managers face in their daily experience of KM measurement, and provide insights into the possible future developments of the KM evaluation approaches.