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IECKnowledge Value-Added (KVA) Methodology

Definition and Overview

Definition

Knowledge Value-Added (KVA1) is a framework for measuring the value of corporate knowledge assets. Rooted in the knowledge economy, this framework provides several business valuation tools (i.e., knowledge and process audits) used by over 60 companies worldwide. Executives use these tools to measure the value of knowledge embedded in company core processes, technology, and employees. The reason for KVA’s growing acceptance as a valid measurement tool lies in its sound theoretical underpinnings, its practicality, and its ease of use for companies competing in the evolving knowledge-intensive global business environment.

Overview

This tutorial explains the knowledge and process audits of the KVA methodology in detail and identifies specific real-world examples in which the technique was successfully employed to measure the performance of knowledge assets. It also provides an in-depth description of each step in the knowledge and process audits, thereby enabling readers to apply it to their own businesses. The Process Edge™ software suite incorporates this methodology explicitly, and an example of a screen from the tool suite is included.

1The KVA methodology is a creation of Drs. Thomas J. Housel and Valery Kanevsky and has been published internationally in numerous articles and books about knowledge management and business process reengineering. Tom Housel is an associate professor in the Marshall School of Business at the University of Southern California, and Valery Kanevsky is a lead scientist at Hewlett-Packard Labs in Palo Alto, California.

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TABLE OF CONTENTS:
Definition and Overview
1 Introduction
2 Case Example
3 Case Example
4 Step Two: Establish a Common Level of Complexity for Learning Time and Process Instructions
5 Step Three: Calculate Time to Learn How to Execute Each Subprocess
6 Step Four: Sampling
7 Step Five: Sum the Learning Time and Process Instructions
8 Step Six: Calculate Process Cost
9 Step Seven: Calculate ROK and ROP
10 Summary and Conclusion
Self-Test
Correct Answers
Glossary
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