Conclusion: Business Value of the Taxonomy

The most important part of this chapter is a discussion of why taxonomy is so vital in today's organizations. Knowledge is power, and the organization with the right knowledge gains competitive advantage. I am familiar with the sales process within the IT industry, and I have learned firsthand the power of this principle. I am far more likely to be successful in selling my product when I am able to show superior knowledge of my product to my clients . Equally important is knowledge of my client's organization. This information is difficult to obtain; but before going into a sales call, I would want access to all previous presentations to this client, any recent news or press releases regarding the company, and specific information concerning the personalities involved. Armed with this kind of knowledge, I can more easily navigate through any obstacle to the sale to the best possible position against my competition.

The problem facing many corporations today isn't that the information doesn't exist; rather it is that they cannot locate the information quickly. Imagine that a salesperson leaves a company without handing over his notes on clients and prospects. Many organizations have learned from such experiences to keep a repository of employees ' documents; but without an effective knowledge map, the right documents would be difficult to locate. Analysts estimate that over 80% of an organization's information exists in unstructured format, such as meeting notes. This information is accumulating at an accelerating rate as more and more organizations move to electronic records management and document management. Yet, data and information add little value to an organization because only knowledge gives an organization power and competitive advantage. Information requires context in order to become knowledge, and this knowledge must get to the hands of someone who can use it.

Knowledge management experts define data in its proper context as information. At the next higher rung of the knowledge ladder, information in its proper context is called knowledge. One could go one step higher and call information in its proper context wisdom, but for now most companies are content with extracting knowledge from their organization. So the big message is that successful organizations need to look toward moving up the pyramid by providing context to that which already exists within their organization. Over the last 50 years , businesses have invested trillions of dollars in IT in order to get and record information. Now businesses need to begin to shift their focus toward getting this information to the right people. Furthermore, because time is money, the faster an organization can impart knowledge to its employees and clients by supplying the correct information at the right time, the more money it will make. It really pays for an organization to invest in developing a well-designed taxonomy as a foundation for maximizing the potential of its people and, in turn , the organization. The downside, of course, is the considerable upfront cost involved, though the potential benefits are well worth the investment.