Assessing the contribution of knowledge to business performance: the KP3 methodology

Knowledge is inherently difficult to measure. However, without valid and reliable measurement, it is very difficult to develop a comprehensive theory of knowledge and provide a practical guide for knowledge management. In this paper, we do not measure knowledge directly, but assess how much knowledge contributes to business performance. The KP³ methodology developed in this paper assesses the contribution of knowledge to business performance by employing product and process as intermediaries between the two. The understanding of the contribution is essential because it makes it possible to assess the productivities of knowledge entities, evaluate and compensate knowledge workers, and to allocate and develop human capital.