Systems costs for KM applications, platforms, and related technology per $1,000 revenue

This measure calculates the organization's expenditure in systems cost for knowledge management (KM) applications, platforms, and related technology, per $1,000 revenue. KM is responsible for organizing an entity's knowledge base; determining the kind of specialized knowledge an entity possesses, and which elements of this collective knowledge are beneficial; capturing and maintaining this knowledge; and granting access to this library of information. Systems costs include a variety of specific costs related to computer hardware/software, network maintenance, data storage, etc., and all fees paid to full-time, part-time, or temporary employees or independent contractors hired to perform these services. This measure is part of a set of Cost Effectiveness measures that help companies understand all cost expenditures related to the "develop and manage enterprise-wide knowledge management (KM) capability" process.

Benchmark Data


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Measure Category:
Cost Effectiveness
Measure ID:
Total Sample Size:
543 All Companies
Key Performance

Compute this Measure

Units for this measure are dollars.

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Systems costs for KM program applications, platforms, and related technology / (Total business entity revenue * 0.001)

Key Terms

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Total Annual Revenue/Net Revenue

Total annual revenue is net proceeds generated from the sale of products or services. This should reflect the selling price less any allowances such as quantity, discounts, rebates and returns. If your business entity is a support unit and therefore does not directly generate revenue, then provide the revenue amount for the units you support. For government/non-profit organizations, please use your non-pass-through budget. For insurance companies the total annual revenue is the total amount of direct written premiums, excluding net investment income. Note: Business entity revenue needs to only include inter-company business segment revenue when the transactions between those business segments are intended to reflect an arm's length transfer price and would therefore meet the regulatory requirements for external revenue reporting.

Systems Cost

Systems costs include all expenses, paid or incurred, in conjunction with:

Computer hardware or computer software acquired by the organization or provided to the organization through service contracts.

Any related costs to process, service and maintain computer hardware or computer software. The costs of providing and maintaining services for each applicable process (e.g., computer system(s) processing (CPU) time, network/system communication charges, maintenance costs for applications and data storage). This includes the costs related to LANs, WANs, etc. This does not include one-time costs for major new systems developments/replacements. Consultant fees should not be included in depreciation of new system implementations. Include only those costs that occur more than six (6) months after implementation, as normal system maintenance costs. Any systems cost (e.g., maintenance) which is outsourced to a third party supplier should be captured in the separate cost category labeled outsourced cost.

Systems cost should include all salaries, overtime, employee benefits, bonuses or fees paid to full-time, part-time or temporary employees or independent contractors who perform services relating to computer hardware, computer software, processing or systems support.

Cost Effectiveness

Cost effectiveness measures are those in which two related variables, one of which is the cost and one of which is the related outcome related to the expenditure are used to determine a particular metric value.

Measure Scope

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Cross Industry (7.3.0)

  • 13.5.1 - Develop KM strategy (11095) - Creating a plan for managing the organization's knowledge base. Determine what kind of specialized knowledge the organization possesses, which elements of this collective knowledge can prove beneficial, how to capture and maintain this knowledge, how to grant access to this library of information, and how the organization should proceed.
    • - Develop governance model with roles and accountability (11100) - Developing a structure for the governance of the organization's collective knowledge. Gather, maintain, and make accessible the collective knowledge base. Develop a standard procedure for the conservation and perpetuation of the organization's knowledge. Create policies for the usage and maintenance of this knowledge. Establish specialized roles.
    • - Define roles and accountability of core group versus operating units (11102) - Clearly determining the roles and responsibilities of all personnel involved in the management of the organization's corpus of knowledge. Flesh out the roles and responsibilities of the KM core group, as well as the operational staff involved in the upkeep of the knowledge management program.
    • - Develop funding models (11103) - Analyze the organization's current approach to funding. Learn from the funding approaches of peer organizations. Evaluate the revenue potential and costs of those short-list funding models. Select funding models to implement.
    • - Identify links to key initiatives (11104) - Identifying any links that exist between the strategy for knowledge management and any other functional areas. Determine any correlations that exist between the strategic road map for the knowledge management and any other functional areas. Study each function's/unit's attributes.
    • - Develop core KM methodologies (11105) - Creating core knowledge management procedures and methodologies. Initiate developing a strategy, planning, execution, and improvement.
    • - Assess IT needs and engage IT function (11106) - Determining the IT needs for developing the knowledge management strategy, and collaborating with the IT function to implement the strategy. Assess requirements for technologies such as computer hardware, software, electronics, semiconductors, internet, and telecommunications equipment in order to effectively build and implement the strategy for knowledge management.
    • - Develop training and communication plans (11107) - Creating plans for KM training plans and conveying the knowledge management strategy within the organization. Create training programs, sessions, and activities in order to familiarize employees and management with the concept of knowledge management.
    • - Develop change management approaches (11108) - Creating approaches for effectively administering the changes in knowledge management. Design an approach that transforms individuals, teams, and the organization to a desired future state represented by the change.
    • - Develop strategic measures and indicators (11109) - Establishing measures and indicators for evaluating the performance of the knowledge management function. Define key performance indicators such as the amount of knowledge assets created and number of knowledge projects undertaken.
  • 13.5.2 - Assess KM capabilities (11096) - Assessing the maturity of the existing initiatives in knowledge management, and evaluating existing KM approaches. Identify the gaps and needs in order to enhance the existing KM approaches. Develop and implement new KM approaches.
    • - Assess maturity of existing KM initiatives (11110) - Evaluating if initiatives are effective or should be discarded. Design a framework for assessing maturity, typically from Level 1 (undefined), Level 2 (repeatable), Level 3 (defined), and Level 4 (managed) through Level 5 (optimized).
    • - Evaluate existing KM approaches (11111) - Evaluating existing procedures, policies, and guidelines for knowledge management. Study and examine the organization's approach against industry best practices by benchmarking, competitive analysis, etc.
    • - Identify gaps and needs (11112) - Assessing the KM approach evaluations in order to identify any gaps or needs. Compare the performance of the KM approach against the desired or expected performance, as well as against the standard knowledge management industry approach.
  • 13.5.3 - Design and implement KM capabilities (20965) - Creating knowledge bases and other repositories to preserve and develop company expertise, and to train new employees.
    • - Develop new KM approaches (11114) - Designing new policies, procedures, and guidelines to support knowledge management.
    • - Design resource model for KM approaches (20966) - Creating a model to describe resources and approaches to organization's knowledge management. Establish standards and guidelines to be followed.
    • - Implement new KM approaches (11115) - Implementing new policies, procedures, and guidelines to support knowledge management.
    • - Leverage and enhance IT for KM approaches (20967) - Using existing technologies to improve organization's knowledge management processes. Research available third-party offerings. Develop proprietary solutions. Employ knowledge engineers, data scientists and other relevant personnel.
    • - Develop measures (20968) - Creating metrics that can be used to systematically describe KM approaches and capabilities. Choose applicable scales, benchmarks and units of measure. Determine required precision and error rates.
  • 13.5.4 - Evolve and sustain KM capabilities (20969) - Developing resources for improved knowledge management and knowledge engineering.
    • - Enhance/Modify existing KM approaches (11113) - Leveraging KM evaluations and identified gap to enhance existing approaches.
    • -  Sustain awareness and engagement (20970) - Developing awareness about available knowledge bases and promoting their use to maximize their impact.
    • - Expand KM infrastructure to meet demand (20971) - Augmenting available resources to better leverage the offerings of the organization to serve existing clients and to expand the client base.