Application of a scoring method for measuring the value of knowledge‐based systems to key employees

Abstract

This paper presents a method designed to measure the value of Knowledge Based Systems (KBSs) to the employees involved in their development, implementation and use at an organisation. The method is based upon the scoring approach to valuation. The major advantage of using this approach stems from the fact that many KBSs are typified by numerous intangible benefits and costs. Traditional cost benefit models are unable to account for the contribution of intangible benefits to the value of an evolving KBS project. The method presented here overcomes this difficulty by using managers, users, and experts involved in a KBS project to measure its perceived value from both tangible and intangible sources. It produces an overall measure of value which is separated into three critical categories ‐ time, finances, and quality. Time and finances are tangible, while quality is intangible. These categories are meaningful to decision makers at all organisational levels and are critical in making an informed investment decision. The paper applies the method to two KBS projects from a large manufacturing and sales organisation. Suggestions are made for practical uses to which the method can be applied.