Creation of Innovation Through Knowledge Management

The CIKM project was successfully completed on October 31st, 2003. During 20 months of project work, the interrelationship between Knowledge Management (KM) practice and Innovation in European companies has been analysed and empirically investigated. The empirical field study focused on the industrial sectors of ICT, Financial Services and Mechanical Engineering, and was conducted in France, Germany, Sweden and the UK. The study findings basically correspond to state of the art in literature and expert opinions that there is no measurable direct interrelation between KM practices and Innovation Performance. However, there are a number of indicative interrelations between KM practices and the early stages of innovation which could be identified. These are summarised as follows and are based on the research conducted in 54 companies having responded to the questionnaire plus 25 companies participant to the case studies and focus group workshops: The ability of a firm to recognise the value of new, external information, assimilate it, and apply it to commercial ends is critical to its innovative capabilities. Organisational, face-to-face, people and culture based KM practices - such as workspace layout and discussion forums to encourage increased communication between people involved in innovation activities - were found to be key elements fostering innovation in the early stages of the innovation process. Good practice companies employ technological KM practices (ICT tools) as an “enabler” to KM. Through cluster analysis, specialties have been identified for the different industries investigated, as well as those practices and sources that were used by innovation over-performers. Practices and information sources can be named in which the innovation over-performers are different compared to the under-performers across the whole sample of surveyed companies. The triangulation of data from the survey data, case studies and focus groups showed the importance of 6 themes: (1) Drivers of innovation; (2) Strategy; (3) Ownership of the innovation role; (4) Metrics; (5) Knowledge processes and knowledge types; (6) Culture. A number of recommendations for companies to introduce and practice KM are suggested, taking into account the specifics of the different industrial sectors