Validating Enterprise Management Engineering Through the Use of Knowledge Capital Assessments

This is the first in a series of studies intended to validate the efficacy of the Enterprise Management Engineering© (EME) approach, a more flexible variation of the usual systems engineering (SE) approach, to KM systems implementation. The study used large US publicly-traded non-financial firms due to the need for public financial data. Subject organisations were assessed using a measure of intangible valuation developed by Professor Baruch Lev of NYU called Knowledge Capital Earnings© (KCE). These organisations were surveyed on the 18 points of the EME approach, and the EME results were then compared against each other and against each organisation's KC scores. The data show that companies with high KCE also implement most if not all of the 18 steps within the EME construct and demonstrate that a quantifiable correlation exists between the EME approach and successful KM implementation. Now that there is a correlation, work can begin on investigating causative factors (which factors in the systems development produce MORE value for a company — and which ones have we overlooked altogether?) and on modifying the model to address the results of the survey. This in turn should contribute to the slim body of objective knowledge on the design, deployment, and measurement of KM systems.