The knowledge management movement may be able to trace its lineage back to the 1980s and beyond, but its rise to prominence was a product of the dotcom years.
Concepts such as intellectual capital offered a convincing way to explain the vast differences between stock market valuations and the actual revenues of high-tech companies. Knowledge became a sort of "dark matter" - hard to quantify or value but essential to balance equations.
With traditional market verities re-exerting themselves, knowledge management still has something to offer because our equations still do not add up - and looking at the issues raised by knowledge management helps us to realise this. We do not understand the real nature of a global, high-tech market and what it may evolve into. Proof of this lack of understanding is in the cries of "no visibility" from leading companies and economists as they grapple with the crisis in the technology market.
But this does little to help beleaguered knowledge management professionals and IT departments trying to justify investment in new and existing projects, as the squeeze on costs increases. Return on investment has become the new mantra for users and suppliers but that does not make quantifying the unquantifiable - which is the best description for most knowledge management projects - any easier.
To gain support for such projects we need to promote and defend two central ideas that knowledge management has brought to the fore and to refocus our efforts in the most effective way. The first principle of knowledge management is that people are the most important asset of any knowledge-based company. However much we codify, capture and analyse our information, it cannot replace the value of experience. Many organisations discovered this the hard way after the cut-backs of the early 1990s when experienced staff were laid off, depriving companies of the knowledge they needed to weather tough conditions and exploit new opportunities.
A second key principle is the value of communication. The revolution in business in the past few years is largely down to new opportunities for communication, information exchange and collaboration. The Internet, the Web, intranets and mobile technology have all created a new sense of interconnectedness that spans traditional boundaries.
We cannot back away from the quest to understand these changes and their impact on business. We have to engineer our organisations to be efficient at all forms of communication. Then, we can really make use of the human assets in our workforce and relationships with partners, suppliers and customers. Rather than simply arguing that these innovations are of value in themselves, we have a chance to show how they can change the way we work and improve our ability to meet current challenges.
Knowledge managers and IT professionals must ensure that knowledge management projects are focused on the area that can brings maximum advantage - customers.
Our best chance to show that knowledge management is valuable, and that the processes and the technology that we have developed can make a difference, is to show how it meets the needs of customers in a tough market. If you are starting a new project make sure its focus is on bottom-line improvements that customers will recognise.
Organisations that can do this will improve not only their short-term prospects, but their understanding of the requirements for long term success in a knowledge economy. The idea that only "smart" companies will succeed in the new economy is truer now than it ever was when even a Web-based jelly bean exchange could seem a viable business proposition.
Eric Woods is knowledge management research director at Ovum