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Using Simulation to Explore the
Dynamics of Organizational
Knowledge
ISDC 2003
Eliot Rich (e.rich@albany.edu)
Peter Duchessi (p.duchessi@albany.edu)
Ve | UNIVERSITY at ALBANY
a’ State University of New York
Knowledge Management Dynamics
How does the 3
firm affect
KM, and KM é L>
affect the firm S a
over time?
ISDC 2003 Ve | UNIVERSITY at ALBANY
jiversity of New York
Sustainable or Unsustainable KM?
Percentage Change in Staff Knowledge
40
20
0 oreo ae
0 24 48 72 96 120 144 #168 192 216 240
Months
Sustainable —+ +t +t +t +t +t + +t +t Pct Change
Unsustainable 2 3 2 2 2 = 2 ra z Pct Change
ISDC 2003 Ve | UNIVERSITY at ALBANY
State University of New York
Elements of a
Dynamic Causal Model
Knowledge growth and
decay from turnover and
obsolescence
Successful knowledge
management increases
demand for knowledge
Increasing demand for
knowledge increases costs
Incremental contributions
have less value than
fundamental ones
ISDC 2003
Percentage Change in Staff Knowledge
ee TS
0 SERPeREEe
OTE 96a at Tee TS Theo
Months
Organizational
Knowledge
+
+
Staff
Knowledge
ag ee
Duplication
RA UNIVEKSILY Al ALBAN ve
x State Uni
iversity of New York
The KNOWLEDGEI1
Simulation Model
Knowledge
Change
* Model of Firm Growth Hires and Quits
knowledge
Staff Availability
processes of firm X 4
with well-defined
domain boundaries
¢ Structures and Pa
. Tasks Completed
behaviors from
literature and
interviews
Revenue Microworld Model Boundary
ISDC 2003 A UNIVERSITY At ALBANY
versity of New York
Causal Model of Knowledge Management
Staff Knowledge————_ Shared
knowledge from
OKR
Satisfaction (eS +
with OKR
Effects
i) Organizational
Completed Knowledge
Repository
ISDC 2003 Ve | UNIVERSITY at ALBANY
State University of New York
Causal Model of Knowledge Management
Staff
agoSS*~S:*Sa Knowledge-————_ Shared
knowledge from
OKR
8)
3 Satisfaction (mS ss
with OKR
a Effects
Tasks her) Organizational
Completed Knowledge
= Repository
+
+ Time on tasks : Time on KM
Gf
ISDC 2003 Ve | UNIVERSITY at ALBANY
State University of New York
Causal Model of Knowledge Management
Staff
:
agoSS*~S:*Sa Knowledge/——___ Shared
ie knowledg:
8)
fe
Satisfaction
with OKR
a Effects
Tasks her) Organizational
Completed Knowledge
= Repository
+
a Time on tasks : Time on KM
~Yie
ISDC 2003 Ve | UNIVERSITY at ALBANY
State University of New York
Staff Demand and Agin
<Avg Knowledge of
<I
Junior Staff Coons Junior Staff> Knowledge
Knowledge at Decay Time
Hire \
Junior Knowledge lost puinior Knowledde lost Senior Knowledge
to decay to Quits
lost to Decay
<Junior Quits>
Knowledge of Junior Staff Knowledge of Senior Staff
Seri ania a a
From Hires Knowledge of
Promotions to
Senior
cae Knowledge
Lost to Quits
Senior Knowledge y \
from tasks
Avg Knowledge of
Senior task effort on Senior Staff
Knowledge gained pel
junior person month
on task
Knowledge per
senior person month
on task
Junior Knowledge
from tasks
Avg Knowledge of
tasks
Junior Staff
Junior task effort
per person
<init Junior
Staff> <init avg
knowledge of ama
ie senior effort
Junior Staff Senior Staff
Junior Hires
Promotions to
~~» Senior
Junior
lunior time to < 1
Repent I quit Time to Promote nk Senior
Hires Total Staff i Elucs
Senior time to
quit
Avg staff
RDC 2003 son he | UNIVERSITY at ALBANY
Stare University of New York
Organizational Knowledge Repository
<realized effort on
new documents>
New Additions
>
ISDC 2003
<realized effort
on revising>
Cutting Edge
OKR
Documents
oe
Establishing
Established
OKR
Documents
intro docs
Se Documents
time to establish
documents
y
effort needed to Revised banter eta
revise Documents
Obsolete OKR
Documents
f—™ Aging Discarded
Documents Documents
time te
ee age effort needed to
documents
discard
Organizational
Knowledge
Repository
UNIVERSITY at ALBANY
Stare University of New York
A
Learning from OKR
i
Junior Knowledge lost
to decay
Knowledge of Junior Staff
———
Junior Knowledge
From Hires ry
Junior knowledge
gained from OKR Junior Knowledge
from tasks
effect of OKR on 3
junior knowledge
‘Avg Relevance
of OKR
Organizational
Knowledge
Repository
‘Avg coverage
ofOKR +
>
ISDC 2003
Junior Knowledge lost
ad
Senior Knowledge
as lost to Decay
to Quits
Knowledge of Senior Staff an!
|Senior Knowledge
Lost to Quits
Knowledge of
Promotions to
Senior
Senior Knowledge
from tasks
Senior task effort on
tasks
Resource Allocation
senior effort
‘on OKR
UNIVERSITY at ALBANY
Stare University of New York
A
Satisfaction and Demand
effect of
oe satisfaction on
2 requests
<Junior Staff>- OKR requests per .
person per month
+
Ki Relative OKR
Saisie R Satisfaction
per month
i +
effect of OKR on
tisfacti
effect of OKR on satisfaction
junior knowledge
vas 4, Avg OKR
+ effect
Avg Relevance
of OKR
Avg
coverage
of OKR
Organizational
Knowledge
Repository
RDC 2003 FQ UNIVERSITY at ALBANY
Stare University of New York
Satisfaction and Resources
Satisfaction
with OKR
Effects
Avg Relevance
of OKR
Avg coverage
effect of OKR Satisfaction cites
on resources available to +
OKR
Organizational
Knowlege
+ RIB? Repository
frac senior effort
on OKR
resources
available for OKR
senior effort on
OKR
RDC 2003 FQ UNIVERSITY at ALBANY
Stare University of New York
Benefit Cost and KM Resources
frac senior effort on
OKR
effect of knowledge
benefit to cost ratio on
resources available to senior effort on
OKR
ic
B
Avg knowledge +
benefit cost
perception
a
indicated Lost sr knowledge from
knowledge benefit work on OKR
to knowledge cost .
ratio ~~
+
Organizational
Knowledge
Repository
Junior knowledge
gained from OKR
RDC 2003 JF] UNIVERSITY at ALBANY
Stare University of New York
Sustainable Scenario (Base Run)
¢ Initial Conditions
— Knowledge decay rate constant (~33 month h/1)
¢ KM Start (time 10)
— 5% senior staff time diverted to OKR
— Small seed into OKR of highly relevant
documents
ISDC 2003 A UNIVERSITY At ALBANY
NS State University of New York
Sustainable KM
Percent Change in Junior Staff Knowledge
100
40
0 12 24 36 48 60 72 84 96 108° 120
Time (Month)
Pct Change of Knowledge of Junior Staff: Base —+——+—_ dmn
Repository Size
2,000
1,000
JEREEEERRRENETECoo oes
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Organizational Knowledge Repository : Base—4——+—_+—__+
Repository Relevance
0.5
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Avg Relevance of OKR : Base—+—+—+—+—+— ++
Repository Coverage
Change in Senior Staff Effort on KM
0.5
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Avg coverage of OKR : Base —+—+—_+—__ + +++
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Pct Change in Sr Staff Effort (Base}++—++—+—+—_ dmnl
Percent Change in Junior Staff Knowledge
100.
Fast Decay Knowledge: | ,,
Unsustainable 20 PORE =o
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Repository Size
1
2,000
0.5
1,000
: 0
0 ami r |
Repository Relevance
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Organizational Knowledge Repository : Base
Organizational Knowledge Repository : Fast Decay Knowledge 2233 >
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
‘Avg Relevance of OKR : Base
‘Avg Relevance of OKR : Fast Decay Knowledge
Repository Coverage
Percent Change in Senior Staff Effort on KM
1 100
0.5 oR ee
0 -100 3
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Avg coverage of OKR : Base
‘Avg coverage of OKR : Fast Decay Knowledge
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
senior effort on KM : Base
dmnl
senior effort on KM : Fast Decay Knowledge ——2——3———3-——3-—>—— dnl
Underfunded KM:
Unsustainable
Percent Change in Junior Staff Knowledge
100
40
20 FT Tt eT
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Pet Change of Knowledge of Junior Staff’: Base ——}——} ——_} +} 4 4 dnt
Pet Change of Knowledge of Junior Staff’: Underfunding
22222 dnt
Repository Size
0 12 24 36 48 60 72
Time (Month)
Organizational Knowle
.epository : Base
Organizational Knowledge Repository : Underfunding 2——2>
Repository Relevance
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
‘Avg Relevance of OKR : Base
‘Avg Relevance of OKR : Underfunding
Repository Coverage
0 12 24 36 48 60 72
Time (Month)
Avg coverage of OKR : Base
Avg coverage of OKR : Underfunding
Percent Change in Senior Staff Effort on KM
100
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
pet change in senior effort on KM : Base dma
pet change in senior effort on KM : Underfunding ——3——2——3——>—s—>—dmnl
Unmet User Expectations:
Unsustainable
Percent Change in Junior Staff Knowledge
20 F PT Pra Pee
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Pet Change of Knowledge of Junior Staff : Base —}+——+—+—+-—+——+-——+ dal
Pet Change of Knowledge of Junior Staff : Unmet User Expectations —2——3——3——3— mal
Repository Size
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Organizational Knowledge Repository : Base
Organizational Knowledge Repository : Unmet User Expectations. 33-3 >_>
Repository Relevance
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Avg Relevance of OKR : Base
Avg Relevance of OKR : Unmet User Expectations 233 > >_> >
Repository Coverage
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Avg coverage of OKR : Unmet User Expectation:
Percent Change in Junior Staff Knowledge
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Pet Change of Knowledge of Junior Staff: Base —+——+-——+——++——+—4 dnl
Pet Change of Knowledge of Junior Staff : Unmet User Expectations —3——3—3——3——_dmnl
Unmet Management
Expectations:
Unsustainable
Percent Change in Junior Staff Knowledge
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Pet Change of Knowledge of Junior Staff: Base —}——}——}$——}——} deal
Pet Change of Knowledge of Junior Staff: Unmet Management Expectations —3————3——_dmal
Repository Size
2,000
1,000
0 t - = 2+
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Organizational Knowledge Repository : Base
Organizational Knowledge Repository : Unmet Management Expectations ——2—2——3-——>-—
Repository Relevance
0 12. 24 36 48 60 72 84 96 108 120
Time (Month)
Avg Relevance of OKR : Base
Avg Relevance of OKR : Unmet Management Expectations —32——3—3-3——>—__>-
Repository Coverage
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
Avg coverage of OKR : Base
‘Avg coverage of OKR : Unmet Management Expectations 333-3»
Percent Change in Senior Staff Effort on KM
0 12 24 36 48 60 72 84 96 108 120
Time (Month)
pet change in senior effort on KM : Base dmal
pet change in senior effort on KM : Unmet Management Expectations 232 2 dmal
Simulation Results
¢ Sustainable KM programs:
— Achievable if user and management
expectations met in face of endogenous change
— Effects may rise then fall over time
— Apparently unstable equilibrium
¢ Unsustainable KM programs:
— May start off similarly to sustainable programs
— Tip into failure
ISDC 2003 A UNIVERSITY At ALBANY
NS State University of New York
Implications for KM
¢ Sustainability
— Rests on several difficult to quantify factors
— KM satisfaction must be refreshed in face of
constant deterioration
— Short-term gains and effects must be balanced
with longer-term expectations
— Resource shifts from development to review
may be required
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