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Know-how emerges as asset

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By Todd Cohen

A small but growing number of foundations and nonprofits are trying to figure out how to make better use of what they know.

Faced with increasingly complex social problems and a decline in traditional sources of support, philanthropies and charities are looking for ways to collect, sort, use and share knowledge – an emerging field known as “knowledge management.”

“We will function more powerfully as a sector — nonprofits and foundations together — when there’s a much more robust sharing of information about what we’ve accomplished,” says Vince Stihle, program officer for the nonprofit sector at the Surdna Foundation in New York.

Efforts to manage knowledge range from simply publishing reports on a foundation’s internal or public Web site to revamping an organization’s culture so that learning and sharing knowledge become central to every employee’s job.

Still, knowledge-management remains in its infancy in the philanthropic world, and making sense of their own value, strengths and weaknesses can be tough for organizations, says Lucy Bernholz, founder and president of Blueprint Research & Design, a consulting firm in San Francisco that tracks knowledge-management.

“There are many models, and foundations are trying to use knowledge more deliberately, effectively and efficiently,” she says. “What we don’t know is how those compare to each other, their real costs, how to make decisions about choices, and which ones will actually make foundations more effective.”

Bernholz, who has studied the use of knowledge as a philanthropic resource in a project funded by the David and Lucile Packard Foundation in Los Altos, Calif., says treating knowledge as an asset requires that organizations “fundamentally change the way you work.”

That kind of change, she says, requires a commitment from top-level management and a willingness on the part of foundations to overcome a built-in reluctance to share information they view as proprietary – a reluctance reinforced by a lack of any market incentive.

What’s more, she says, while foundations possess information and knowledge about themselves, what nonprofits and other foundations want to know is what nonprofits have learned through the work they do delivering services and programs.

“Foundations are a newsstand of knowledge, not the creators,” she says. “Foundations are in a position to sit and look from the mezzanine at a whole range of issues and find out who’s doing what, where, and share that with other folks trying to solve the same sets of issues in different places, times and populations.”

One foundation that has embraced knowledge-management is the Charles and Helen Schwab Foundation in San Mateo, Calif., which has created a senior position to ensure that shepherding and sharing knowledge – inside and outside the foundation – becomes second-nature to the way the organization does business.

“Knowledge-management is a set of methods for making sure that we’re capturing, packaging and sharing everything we know about what works” on the foundation’s priority issues of homelessness, poverty, substance abuse and learning differences, says Tim Wilmot, the foundation’s chief knowledge and evaluation officer.

“We realize that as a foundation, we’re not going to make much of a difference acting alone, and what we really need to be doing is acting in partnership with these other players,” including foundations, policymakers, nonprofits, grantees and academic institutions, he says.

With its president, Alexa Culwell, driving the push for knowledge-management, the $290 million-asset foundation is creating a collaborative culture from the top down and from within, says Wilmot, a former manager with the Cleveland-based Center for Business Knowledge at New York-based Ernst & Young, the professional-services firm.

He serves, for example, on the foundation’s cabinet, where knowledge-management is valued and influences policy and practices throughout the foundation, he said.

“We are expected to share everything we know and be authentic about it,” says Wilmot, who has a staff of two knowledge officers and an evaluation officer.

Since joining the foundation in July 2001, Wilmot has created knowledge-management “shock troops” – “knowledge coordinators” who are members of interdisciplinary work-teams that, respectively, focus on each program area and also include program and communications officers from those areas.

The role of the knowledge coordinator is to gather, organize and share information that the team is working on or may need for its work.

The foundation also developed an open-source internal Web site that the work-team members can use to communicate with one another and with other work teams.

At the W.K. Kellogg Foundation in Battle Creek, Mich., an initiative has been underway in recent years to make more productive use of knowledge.

“We realize that the tracking of specific grant activity and money is important,” says Tim Dechant, the foundation’s director of technology. “But also important is to capture and organize what we know and who we know.”

The foundation has worked to create greater consistency in its operations and to develop common practices in the work it does to help spur social change, says Dechant, another Ernst & Young veteran who handled information-technology consulting before joining the foundation five years ago.

While technology can boost those efforts, he says, they depend on changes in business processes and in organizational culture, behavior and attitudes.

“You can build the best tools you want,” he says, “but unless people incorporate them into their daily routine, they’re not going to be used.”

What’s more, he said, while the foundation is “reengineering” its business-information systems to handle the collection, analysis, storage and sharing of information, the use and value of that information depends on people.

“There is no system that manages your knowledge,” he says. “People manage their knowledge and you develop systems to help people manage knowledge.”

Managing knowledge can be particularly tough at foundations, says Tom Reis, a program director for philanthropy and volunteerism at Kellogg.

“The culture of organized philanthropy is not one of fast-paced, open communications, which is a necessary ingredient for leveraged knowledge management,” he says.

A big challenge, he says, is for foundations to share with one another and with their grantees and partners knowledge that they typically view as a private asset.

Sharing knowledge also is a focus of The Bridgespan Group, a Boston-based nonprofit consulting firm that advises nonprofits and was spunoff from Bain & Co., a Boston-based management consulting firm.

As part of its work advising nonprofits and foundations, Bridgespan tries to distill what it learns and share it with the nonprofit world at large.

“Rath
er than our growing knowledge being a proprietary advantage, we’re looking for opportunities to give it away,” says Nan Stone, a former editor of the Harvard Business Review who joined the firm in January as a partner, responsible for “knowledge.”

As part of her job, Stone works with staff members assigned to nonprofit clients and is developing ways “to capture information and develop it and share it,” including creation of an internal Web site.

“Given the challenges the nonprofit sector takes on,” she says, “it’s important that the things we’re learning, if possible, not stay bottled up in the organization that’s learning it.”

To help spur the broader sharing of knowledge, Grantmakers for Effective Organizations, an affinity group of the Council on Foundations, is considering creating a working group of representatives of foundations working on knowledge-management issues, says Kellogg’s Wilmot.

Bernholz, the consultant, says advances in technology have prompted many foundations to make big investments in knowledge-management systems without thinking about the need to stop treating knowledge as private property.

“The need and the opportunity for philanthropy and the nonprofit sector as a whole are to share what they know to achieve the goals they’re striving to achieve,” she says. “Changes need to be made at the organizational level, but what really matters about knowledge is the benefit it brings to the whole social sector.”

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