Quantifying Benefits of Knowledge Management System -A Case Study of an Engineering Consulting Firm

Quantifying the benefits of a knowledge management system (KMS) is a difficult job. Very little literature was found to report the rate of investment (ROI) resulted from a KMS. Quantification of returns from KMS investments involves several tasks: identification of value added knowledge management (KM) activities, identification of benefits generated by the value added KM activities, and quantifying the values of benefits. This paper is dedicated to the development of quantitative models for measuring time, man-hour, and cost benefits resulted from a KMS of an engineering consulting firm. Details of the proposed quantitative KMS benefit models are presented with a case study application to a local leading engineering consulting firm. It is found from the case study that the average time benefit (TB) is 63%; the average man-hour benefit (MHB) is 73.8%; and the average cost benefit is 86.6%.