Providing real-time information and automated processes for employees are some of the reasons why companies seek out the robust and versatile capabilities of an ERP system and CRM system. With a centralized shared database, employees can retrieve the accurate and reliable data they need. Manual, repetitive tasks can be automated, freeing an employee's time so they can work on other tasks.
Another aspect to tackle in the working environment is fostering high interdepartmental collaboration. Gaining information only from word of mouth can be easily forgotten on the way back to the desk. And, due to each department using differing applications, communication must be sent out using alternative avenues such as phone calls, email, chat, or messaging services. The different applications often have no way to effectively communicate the same information between each system.
Tacit knowledge is one of the biggest challenges to achieving interdepartmental collaboration. If information isn’t stored where everyone can access it, businesses can be left in the lurch when an essential employee leaves. In this post, we’ll take a look at what tacit knowledge is and how it can hurt a business. We’ll also provide information on how an Enterprise Resource Planning (ERP) system and/or Customer Relationship Management (CRM) system can solve the problem of tacit knowledge by collecting and sharing information across your organization.
Tacit knowledge includes any information that’s important to an organization but isn’t widely known to its members. It includes personal experience, such as the personal relationship between a salesperson and client, which can profoundly affect discounts and other contract terms. Tacit knowledge also includes technical aspects of a business’s operations like the optimum timing of a process or undocumented quirks of a piece of equipment.
Tacit knowledge also refers to information that isn’t written down or recorded in a computer, so it’s essentially locked inside an employee’s head. This leads to critical information being passed down by word of mouth from one employee to another, and typically this already limited method of sharing only occurs when new employees begin assisting current employees with their duties.
Some amount of tacit knowledge is inevitable, since it isn’t practical to make a record of everything that an employee learns on the job. Tacit knowledge is often vital to an organization’s successful daily operations, but it can also be harmful when data hasn’t been shared and an essential employee with a wealth of tacit knowledge retires or leaves the company, taking that information with them.
The ways in which tacit knowledge can negatively impact a business primarily include lost productivity, false information, and the impairment of process analysis.
An organization’s productivity can be harmed when only one employee has key knowledge, such as exactly what has been promised to a client or how a process works. This problem may be insignificant if the employee is merely on vacation or sick, but it can become profoundly serious when that person is not longer at the company. This situation can severely impact an organization’s ability to meet its production quotas or customer expectations.
In this case, the only solution may be to train a new employee from scratch without the benefit of tacit knowledge. Furthermore, closing this knowledge gap is generally a matter of waiting for the new employee to rediscover the lost information or create new information on their own.
The fact that tacit knowledge isn’t recorded also means that it isn’t subject to the checks and balances of documented processes. Tacit knowledge is usually accurate since it’s based on observation, but exceptions do occur. This can happen when an employee takes an action based on an incorrect observation that still results in the desired outcome. In this case, the incorrect procedure can become tacit knowledge, resulting in negative outcomes down the line that can be difficult to resolve.
Organizations often look for ways to improve their productivity, which includes a thorough review and analysis of all documented processes. However, tacit knowledge represents a gap in process analysis, since only key workers possess this information and it isn’t available to the person or team running an audit.
Tacit knowledge prevents process analysis from ever being complete, thus compromising the success of any optimization efforts. This limitation is especially harmful in manufacturing, where increasing production efficiency is crucial for remaining competitive in your industry. All these factors make tacit knowledge undesirable in the long term, despite its short-term benefits.
Enterprise Resource Planning (ERP) software provides a single location to store and access real-time data and functions throughout the company, so it takes little effort to leverage this system to create reliable collaboration that cuts down on miscommunication, even when outside of the office.
A top issue with interdepartmental collaboration is that certain departments become left out of the chain of communication. A message concerning a product defect may be relayed between the manufacturing department and finance employees, yet not reach the sales reps in time to prevent them from up-selling the product to customers. With ERP and CRM systems, everyone has access to vital communication, as these tools:
Customizing an ERP and/or CRM solution begins with extracting all information on an organization’s processes that currently exist in the heads of employees. This generally consists of conducting an interview with key employees about their work. This data collection helps ensure that the custom ERP solution includes all of a business’s critical processes needed to keep things running smoothly.
While some employees are struggling to stay within the communication loop, other workers may be inundated with too many messages. It can get to the point where they are spending more time deleting similar emails and chat messages than reading them, and they end up accidentally dumping new information that may be vital to their work.
All information is hosted in a single, oftentimes cloud-based, database, so data is no longer redundant or repetitive. Employees can focus on the reports which are necessary without actively avoiding messages. This process can also make employees who were previously disengaged with their work more motivated to reach out and communicate with employees in the other departments.
Once an ERP and/or CRM solutions provider has gathered all of an organization’s tacit knowledge, it can begin developing a solution specifically designed for that organization. This solution typically consists of deeply integrated modules that communicate with each other intelligently and seamlessly, allowing users to obtain a comprehensive overview of their organization. Leaders are then able to make better business decisions that improve performance.
Assume for this example that the organization in question is a manufacturing plant. An integrated Tech Stack could allow users to perform tasks at all points in the manufacturing process such as placing an order, issuing and paying the invoice, tracking shipments, and automatically updating inventory.
A single system with all these capabilities can save manufacturers a great deal of time by ensuring every user has access to the knowledge they need to perform their job. Using the tacit knowledge that was captured at the beginning of the process allows system designers to tune each module specifically for each individual organization so that employees can share knowledge quickly and easily.
With a successful ERP and/or CRM implementation, data that is difficult to relay through one-on-one communication, or that is department specific and hard to transfer into other systems, can be analyzed, translated, and configured for the other company departments. This process is done automatically through the system. Other employees can quickly analyze the system-interpreted data and reports to make more concise decisions to complete tasks. The data they need is presented instantly as they can pull the information that is desirable.
Data and reports that are moving down the communication line may be modified and changed. ERP software such as NetSuite allows all the departments to understand where and when the changes were made, and which department head made them. This feature provides enhanced transparency on why the modifications were implemented and holds that department accountable. In addition, certain tasks can be locked as they require prior approval from authorized personnel to make the changes.
Not every employee communicates effectively in large meetings or within their own departments. When that employee is required to speak with other department heads in person, communication can become stilted and confusing when trying to provide the information that is useful for that specific department's tasks. This issue can hamper communication while further discouraging the employee from relaying the right data at the right time.
MarTech systems are highly customizable and integrated. Interactive databases are simple to use, as employees can send more comprehensive and thought-out communication right through the system. Other departments can collaborate and pull out the data that is suited for their tasks.
Successful collaboration requires successful implementation. When every department in the company has the same access to messages and data through one database system, it lowers the chances of miscommunication and spurs more productivity on projects.
Always keep in mind the best ERP and/or CRM system to implement should be customized to the company's specific goals and processes. We recognize that the hassle of setting up or migrating between databases is frustrating, but choosing to not make positive changes is not a good option. That's why our team will tackle the tedious data cleanup process, outline an automation roadmap to create in your CRM, and host group and individual end user trainings to ensure company adoption rates are high.