Return on Knowledge: Uncovering the ROI of Knowledge Engagement

Madeline Jacobson
Madeline Jacobson
3 mins
business team members discussing the ROI of knowledge engagement

Note: This blog post is an adapted excerpt from our white paper: The Rise of Knowledge Engagement (And Why It Matters). You can check out the full white paper here.

Knowledge engagement—the practice of proactively harnessing and building upon the institutional and individual knowledge that exists inside an organization—provides both short- and long-term benefits, from improving employee productivity to sparking innovative ideas. 

If you’re a department or team lead overseeing a knowledge engagement initiative, it’s important to be able to demonstrate the positive outcomes and return on investment (ROI) of this initiative to senior leadership. Measuring and communicating ROI is especially critical during times of change or uncertainty when many businesses are adjusting priorities and looking to ensure the most cost effective investments.

In its overview of the five biggest knowledge management (KM) trends for 2020, consulting firm Enterprise Knowledge cited “demand for clear business value” in KM efforts as their top trend. “In this time of global pandemic and economic uncertainty, proving the critical value KM offers is more important than ever,” says Enterprise Knowledge CEO Zach Kahl. “The right KM efforts will help organizations be more agile and perform more effectively in the worst of times, and any smart CEO wouldn’t dare cut those business critical initiatives.”  

So how can you start measuring the ROI of your knowledge engagement efforts? The specific outcomes and key performance indicators (KPIs) will depend on your business and the objectives you’re focused on achieving, but knowledge engagement ROI can be measured across three fundamental areas: retention, innovation, and revenue.

Retention

Knowledge engagement helps provide entire organizations with a holistic view of the customer, leading to greater customer satisfaction and loyalty. But knowledge engagement doesn’t just improve customer retention: it can also improve employee retention. A culture of knowledge engagement demonstrates to employees that their knowledge is valued, gives them opportunities to collaborate with their peers, and gives them visibility into how their work supports larger organizational goals, all of which contributes to greater job satisfaction. 

Outcomes:

  • Increased customer satisfaction and loyalty through better customer experiences
  • Higher employee satisfaction and engagement with decreased information frustration
  • Reduced duplication of work or loss of information and intelligence

KPIs:

  • Customer Satisfaction (CSAT) and Net Promoter Scores (NPS)
  • Time saved per employee (productivity gain)
  • Average decrease in redundant work
  • Contribution views in knowledge engagement platform
  • Decrease in average employee onboarding time
  • Training materials delivered

Innovation

Innovation requires businesses to apply, combine, and build on existing ideas in a way that leads to something that is new and useful to the customer.  A culture of knowledge engagement allows businesses to bring together knowledge and insights from across the organization to fuel innovation.

Outcomes:

  • Collaboration and cross-functional engagement on new ideas and information
  • Delivery of insights to propel and inform business and go-to-market decisions
  • Knowledge creation and augmentation to fuel competitive advantage

KPIs:

  • Knowledge and insights contributed to knowledge engagement platform
  • Consumption and communication of insights by business decision-makers and stakeholders
  • Search volume and keyword trends in knowledge engagement platform
  • Collaboration and engagement metrics in knowledge engagement platform (e.g. comments, questions, shares)

Revenue

Knowledge engagement can increase revenue in a couple of key ways. First, on-demand access to knowledge allows employees to be more productive, leading to greater output and costs saved on operational improvements. Second, organizations can increase revenue through new products, services, and processes that arise from cross-functional innovation and knowledge sharing.

Outcomes:

  • Reduced time spent searching for information and increased time spent on impactful activities
  • Elimination of silos between departments and teams
  • Reduction of work errors and redundant activities
  • Faster speed of decision-making and ability to take action

KPIs:

  • Productivity gains (measured in time saved)
  • Average decrease in redundant work
  • Average decrease in work errors
  • Contribution views in knowledge engagement platform
  • Increase of contributions, comments, questions, and answers in knowledge engagement platform
  • Bottom line revenue increases

Measure Early and Often

The key to assessing and communicating your company’s knowledge engagement ROI is to define the relevant metrics for your business objectives and then measure and report on them regularly. It can also be impactful to pair your data with success stories. For example, if you launch a new knowledge engagement platform and record productivity gains, you could share quotes from your platform users about the ease of finding information and the time they’re saving. 

It’s clear that the knowledge that exists across your business is valuable, and measuring the ROI of your knowledge engagement efforts can help your organization understand just how significant an impact its collective intelligence has on revenue, retention, and innovation.

October 14, 2020

The Rise of Knowledge Engagement

Learn about the rising importance of knowledge engagement and see real-world examples of businesses that have increased the value of their collective intelligence through knowledge engagement strategies. Check out the white paper now.

Download Now
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