What is Organisational Knowledge and why is it important?

What is Organisational Knowledge and why is it so important?

An interesting development in ISO 9001, with the way in which ‘knowledge’ is dealt with, emerged with the last revision of the standard (Clause 7.1.6). In versions prior to 2015, ‘knowledge’ was partially addressed in the documentation section of the standard. ISO 9001:2015 highlights and better acknowledges the significance behind Organisational Knowledge and its ability to influence future success factors of the organisation.

The requirements around Organisational Knowledge were introduced as a means to safeguard organisations from any loss of knowledge; by means of staff turnover or a failure to capture and share information. There is also a distinct level of encouragement towards identifying and acquiring knowledge through learning from experience, mentoring, etc.

‘Knowledge’ is identified as being a significant resource to the business; this, however, doesn’t mean that Knowledge Management is an auditable requirement. Instead, it is an area to which emphasised attention should be given. Organisational Knowledge offers an opportunity for increased awareness about knowledge requirements. It ensures a sound delivery of quality outputs and promotes sustainable business.

A handful of potential challenges arise with this. How does the organisation capture its organisational knowledge? How does the organisation ensure compliance with Clause 7.1.6? How does one effectively audit organisational knowledge management? What additional guidance is there to assist the organisation and/or the auditor, in terms of organisational knowledge?

What is organisational knowledge?

“Organizational Knowledge is the specific knowledge of the organization, coming either from its collective experience or from the individual experience of its persons. In an explicit or implicit way this knowledge is, or can be, used to attain the organization’s objectives.”

Auditing Practices Group Guidance on: Organisational Knowledge, ISO & IAF (2016)

Firstly, ‘knowledge’ is an important resource. It is needed for an organisation to support the QMS processes and to ensure conformity of its outputs.

Secondly, (as implied by the business dictionary) ‘Organizational Knowledge‘ is an asset that we cannot quantify; a collection of individual knowledge that provides an advantage over others in the same field. This definition appears to at least agree with the position of Clause 7.1.6 under section 7. Resources.

What types of organisational knowledge are there?

Organisational Knowledge exists in many shapes and forms. Within the business, there are usually two types of knowledge that can be defined: tacit knowledge and explicit knowledge.

Tacit knowledge

This knowledge is often referred to as the ‘know-how’ that exists in an organisation. Tacit knowledge is found in the minds of human stakeholders and is largely experienced based. It is also considered to be the most valuable source of knowledge. It is the intuitive, hard to articulate knowledge and it is rooted deeply in action and commitment; often requiring the involvement of a specific individual/group of individuals.

Examples of tacit knowledge include skills acquired through tradition, common knowledge or understanding, etc.

Explicit knowledge

Explicit knowledge is the ‘know-what’ knowledge that has been formalised, articulated and most often documented. It’s easy to identify, store and retrieve, which means care needs to be taken in the handling/management of this knowledge. The greatest challenge lies in ensuring that people have access to what they need. There needs to be adequate storage and protection; there needs to be a process in place for explicit knowledge to be formally reviewed, updated or discarded.

Examples of explicit knowledge include databases, memos, notes, documents, etc.

Other types of knowledge

  • Implicit knowledge is ‘knowledge’ that can be articulated but has not yet been articulated.
  • Procedural knowledge is ‘knowledge’ that manifests itself through an activity.
  • Declarative knowledge is ‘knowledge’ that consists of descriptions of facts and things or methods and procedures.
  • Strategic knowledge is the ‘knowledge’ of when to do something and why to do it.

What does ISO 9001:2015 say about Organisational knowledge?

“Determine the knowledge necessary for the operation of its processes and to achieve conformity of products and services. This knowledge shall be maintained and made available to the extent necessary. When addressing changing needs and trends, the organization shall consider its current knowledge and determine how to acquire or access any necessary additional knowledge and required updates.

NOTE 1: Organizational knowledge is knowledge specific to the organization; it is generally gained by experience. It is information that is used and shared to achieve the organization’s objectives.

NOTE 2: Organizational knowledge can be based on: a) Internal Sources (e.g., intellectual property, knowledge gained from experience, lessons learned from failures and successful projects, capturing and sharing undocumented knowledge and experience; the results of improvements in processes, products and services); b) External Sources (e.g., standards, academia, conferences, gathering knowledge from customers or external providers).”

Clause 7.1.6. Knowledge, ISO 9001:2015 Quality Management Systems — Requirements

Interpreting Clause 7.1.6 Knowledge

This sub-clause highlights that the organisation must determine what information is needed for the operation of its processes. There is no requirement for formalised Knowledge Management. ISO 9001 does require that sufficient attention is paid to ‘knowledge’, to ensure the compliance of a QMS. The organisation, therefore, needs to implement arrangements to acquire and maintain knowledge and learning; to ensure its processes consistently deliver the intended outputs, outcomes and objectives.

ISO 9001:2015 suggests that this ‘intellectual property’ is updated according to changing circumstances, identified when satisfying Clause 4.1 and 4.2; regarding context and stakeholder requirements, respectively. 7.1.6 will also have obvious connections with: management review activities; 6.3 Planning of changes; and 7.4 Communication.

Decisions to plan the management arrangements (associated with developing, implementing or changing a QMS) should be informed by facts. This is to provide greater confidence in the objectivity of the decisions taken. This set of requirements, therefore, supports the need for the quality management principle of an ‘evidence-based approach’ to be implemented.

This type of information, or knowledge, may be acquired through lessons learned, subject matter experts, academia or research. The knowledge is necessary to deal with trends or changes that the organisation faces. Competence of the active participants in the QMS will demonstrate the organisation’s ability to deploy the knowledge effectively.

Organisational Knowledge and the QMS

“The balance between knowledge held by competent people and knowledge made available by other means is at the discretion of the organisation, provided that conformity of products and services can be achieved.”

ISO 9001:2015 Organisational Knowledge, Pretesh Biswas (APB Consultant)

The requirements of ‘7.1.6 Knowledge’ cannot be read in isolation. This would remove it from the context of ISO 9001:2015 and minimise the usefulness of this part of the standard.

To develop a QMS the organisation is required to consider the context of its existence. This both in terms of the factors influencing it or that it can influence, including the needs of interested parties. This can be seen in Clause 4 of the standard. These strategic factors influence the definition of its objectives (including quality objectives), as well as the processes that it uses to achieve these objectives. This can be seen in Clause 6 of the standard.

Since “The organization shall establish quality objectives at relevant functions, levels and processes” (Clause 6.2.1), those who are accountable to achieve these objectives require the full ‘know-how’ to fulfil their obligations, or they may miss the mark.

The role of Communication and Organisational Knowledge

Communication (Clause 7.4) plays a significant role in association with the Organisational Knowledge requirements, as well.

The Knowledge clause, therefore, requires that the Organisational Knowledge is determined, held in a current format, and shared with those who need it to do their job. This includes comparing existing knowledge to that which is required, obtaining new ‘know-how’ as circumstances change, and deploying it across all functions, through strategic, management and operational levels.

Synergy through Organisational Knowledge Management

Although the notes associated with Clause 7.1.6 are not auditable, there are strong suggestions that knowledge is sourced far and wide. What one should have picked up by now is that this typically goes way beyond the traditional content of documented process procedures.

We know that knowledge gained by experience (tribal knowledge) is often lost when key players leave an organisation. Gathering such knowledge also forms part of the intent behind knowledge management. This really highlights that having the knowledge and being able to access it is not necessarily the end goal.

Knowledge management is reliant on leadership and culture along with the relevant tools. Developing a learning culture, where those with the knowledge and experience train, coach and mentor those who don’t, is vital. This motivates those who don’t have the knowledge to learn from those who do.

How do we audit knowledge management?

Auditing Clause 7.1.6 Knowledge proves to be interesting. As we have highlighted, there might not necessarily be documented information that pinpoints the organisational knowledge that exists. Again, knowledge could be explicit or it could be tacit. Knowledge might likewise present itself differently depending on the organisation’s context, sector or industry. It might even be dictated by competitiveness.

It is important to remember: knowledge is required for the operation of processes and achieving product/service conformity; this encompasses knowledge related to the QMS and quality related activities.

ISO 9001:2015 also doesn’t require that the organisation keeps documented information relating to the control of organisational knowledge. Instead, it asks the organisation to uncover the knowledge it needs to operate its processes and produce conforming products and services. Once the knowledge has been determined, it must be maintained and made available to the people in the organisation that need it for performing their duties within the related processes. As circumstances change, the organisation must also have a system in place to update this knowledge. These are factors that the auditor would confirm are present in the organisation’s QMS.

“Organizational knowledge is, in the end, key to the ability of a business to deliver within its organizational context.”

Andrew Holt is Technical Content Executive at the CQI.

Working from Clause 7.1.6 Knowledge

When auditing the organisation, the Auditor must assess if the organisation has determined the knowledge it believes is needed for the operation of processes. This information would then be used as the basis of auditing the clause.

There should be an assessment to determine whether management arrangements are in place to maintain what has been identified. This includes being kept up-to-date when changes in the organisation take place, as well as when new knowledge becomes available. One would certainly also look towards identifying that there are arrangements to maintain knowledge through secure storage where appropriate. One would also look for capabilities for distributing this knowledge to those who require it to perform their work.

Auditors might be looking for evidence that your organisation has:

  • completed a scan of key knowledge topics
  • created a list of critical knowledge topics
  • assigned topic owners to each critical knowledge topic
  • created a critical knowledge maintenance procedure
  • an effective way to source knowledge
  • a strategic knowledge plan with identified actions to fill gaps
  • an effective system for learning from experience
  • a knowledge retention and transfer program

Organisational Knowledge in other standards: Guidance from ISO 30401:2018 Knowledge management systems -- Requirements

ISO 30401:2018 Knowledge management systems — Requirements was written with the purpose of supporting organisations looking to develop a management system that effectively promotes and enables value-creation through knowledge.

Each organization will craft a knowledge management approach, with respect to its own business and operational environment, reflecting their specific needs and desired outcomes.

The intent of ISO 30401:2018 is to set sound knowledge management principles and requirements. This serves organisations that aim to be competent in optimising the value of organisational knowledge. The standard also exists as a basis for auditing, certifying, evaluating and recognising competent organisations by internal and external recognised auditing bodies.

Conclusion

Organisational Knowledge management should never be seen as just a “good thing to do”. There is clear evidence that Clause 7.1.6 not only has an impact on the organisation’s ISO 9001:2015 compliance but also ensures business continuity. 

It is imperative that a culture of knowledge sharing and learning is adopted by all stakeholders. Individuals need to be open to the concept and should be clear on how this sub-clause impacts the organisation; plans need to be in place to ensure that the requirements of Clause 7.1.6 are in place.

What are the next steps?

After reading this article, you should be feeling eager to get going with finding and filling your Knowledge Gaps. If you aren’t yet feeling confident, download our FREE guide: FOUR PHASES OF HANDLING ORGANISATIONAL KNOWLEDGE: USING ISO 9001:2015 AS GUIDANCE

We’ve put together a short but comprehensive step-by-step guide for handling ISO 9001:2015 Clause 7.1.6.

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