How effective is your knowledge management (KM) program? Are all the information technology (IT) investments for technologies, such as GroupWare, customer relationship management (CRM), or decision support systems (DSS) tools worth their value? How can you measure the return on your KM investments? This paper addresses these questions by opening up the issues involved, via an extensive literature survey on KM performance measurement.

The paper mentions that only 20 percent of KM programs use some form of metrics to measure how business performance is influenced. This points out the difficulty in KM performance measurement: apart from hard metrics, like return on investment (ROI), some softer measures, like customer and employee satisfaction, social capital, human and cultural issues, and so on, also influence KM effectiveness. For incorporating these softer factors, the author introduces the balanced scorecard (BSC) perspective for KM metrics, linking the original intent of the BSC framework for business strategy with KM. He explains two possible approaches to using the BSC perspective to enhance the KM measurement, one based on capital, and the other on a resource management approach.

Though the paper is quite relevant and contemporary, explains the issue, and provides a literature review of existing relevant research, it stops at that. No study or fieldwork done by the author himself is discussed. Nevertheless, this paper would be of direct interest to KM research scholars, for the literature review alone. Information technology (IT) professionals and their supervisors could also gain insight into the complexity of ROI measurement for IT and KM investments.