Why think of knowledge as a strategic asset?

A focus on knowledge as a strategic asset is important because improving the management of this asset can enhance the efficiency and effectiveness of public sector organizations and help these organizations meet the challenges of the future.

Many experts argue that an organization’s ability to perform well in the information age depends on its ability to use knowledge effectively. In the private sector, knowledge has become a critical source of comparative advantage as companies increasingly draw on factors such as employee knowledge and innovative capacity to remain competitive (Stewart 2001, p. 5; Usoff 2002, p. 9; Pertson 2009, p. 2).

For public sector organizations, improving the generation, sharing and use of knowledge leads to many real benefits, such as:

  • Enhanced strategic decision-making
  • Better-informed policy
  • More cost-effective services
  • Engagement of citizens and stakeholders in new and better ways
  • Innovation
  • Reduced redundancy for routine tasks
  • Better knowledge flow across organizational boundaries
  • Enhanced transfer and protection of corporate memory
  • Improved employee engagement
  • Better quality of information and services provided to citizens


But it is not just about benefits. Successfully managing knowledge is essential for government to achieve its goals and objectives. Senior managers we interviewed suggested that managing knowledge is, in fact, a core business of government and important for supporting public sector values. In this way, knowledge is a strategic asset.

The public service should be a trusted source of information. Government plays a vital role in informing the public on a wide range of topics. Child safety, flu prevention, nutrition, wildfire risks and floodingare just some of the areas where information and knowledge must be shared to protect the public.

Given the provincial government’s shifting role toward decision-making and policy and away from direct delivery of services, generating, sharing and safeguarding knowledge is fundamental. Oversight, coordination and decision-making require knowledge of – among other things – how services are delivered, what impacts or trends place these services at risk and how well citizens are being served.

For example, consider the area of highway engineering and maintenance. It is the know-how of highway engineers, maintenance managers and others that is essential to ensuring roads and bridges are well designed, can meet future demands and are adequately maintained to support public safety. Simply hiring more people to do the work, or bringing in extra equipment will not automatically lead to safer highways. Ensuring that highly qualified and knowledgeable employees are in place to develop policy and oversee contracts is important. But ensuring that there are effective ways to generate new knowledge, share existing knowledge and apply that knowledge to meet business objectives and improve practices is critical.

The challenges of managing knowledge

While the importance of knowledge assets increases, knowledge remains difficult to manage effectively. In KPMG’s European Knowledge Management Survey, for example, 78% of respondents reported feeling that they were “currently missing out on business opportunities by failing to successfully exploit available knowledge” (KPMG 2002/2003, p. 4).

It is likely that management of this resource will become even more challenging in the future. The world is becoming more connected and complex. Change is rapid, and organizations are seeing losses of experienced staff at a time of higher demands on agency services. Along with all of that, the rapid expansion of information and communication technologies means that managers and staff are having to cope with ever greater amounts of data and information.

Making sense of these complexities, adapting to change, effectively capturing and sharing relevant knowledge, and developing knowledge-savvy employees all require deliberate effort (Bontis 2000; DeLong 2004; Handzic et al. 2008).