Teltech: The Business of Knowledge Management Case Study

by

Thomas H. Davenport, PhD

http://www.bus.utexas.edu/kman/telcase.htm

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Table of Contents


Introduction

  1. Teltech Overview
  2. The Expert Network
  3. Assited Database Searches
  4. Vendor Services
  5. Technical Alert Services
  6. Lessons from Teltech
  7. People-Technology Hybrid Services
  8. Pointers to People
  9. Mapping for Information Sources
  10. A Structure for Knowledge
  11. Focus on Information Behavior


Summary


IntroductionTeltech, a small ($17 million in revenues) company based in Minneapolis, offers instructive lessons to companies wishing to better manage their knowledge and information assets. The company has built a successful business on helping companies get access to external technical expertise and information. However, some of its strategies and services could be adopted by firms wanting to take better advantage of all types of internal knowledge. Specifically, Teltech's business model includes the following information management innovations that will be described in this field profile:

Each of these innovations will be described separately after an overview of Teltech and its services.

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Teltech OverviewTeltech was formed in 1984 by Joe Shuster, a chemical engineer who had already built and sold a successful cryogenics engineering company. Shuster felt that his previous firm would never have been successful without accessing a broad range of experts from outside his organization. As a result, he saw an opportunity to facilitate the process of knowledge gathering for technically-oriented companies (knowledge is defined here as information with a high degree of value-added, i.e. the interpretation, context, and implications of information that experts can provide).

Teltech originally planned to offer only access to a network of technical experts. But early research with potential customers suggested that they also wanted access to online databases. Teltech decided to offer both services. Over time, additional services were added as customer needs became apparent. Now Teltech offers four basic services, each of which is described below.

1. The Expert Network - Teltech maintains a network of thousands of experts in technical fields. The experts, over 3000 of whom can be found in Teltech's online system, are typically academics, recent retirees from industry, or consultants. When a client calls Teltech, they engage in a dialogue with a Teltech "knowledge analyst" about their problem, or they are given one or more names of experts who can speak knowledgeably on the customer's issue. These names are principally found in Teltech's expert database. If the client calls the expert and has a discussion, Teltech bills the client and the expert receives a payment from Teltech. Teltech sources suggest that most experts do not participate for the money they receive but rather for the professional networking and the learning.

All Teltech experts have agreed to the pricing for their advice, have pledged to keep the client's information confidential to protect its proprietary interests, and to avoid using the Teltech referral as an opportunity to sell their own consulting services (though clients sometimes ask experts to consult, which does increase the attractiveness of serving as a Teltech expert). The issues on which experts are sought vary widely from call to call, as Exhibit 2 suggests.
Exhibit 2
A Sampling of Expert Network Issues

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2. Assisted Database Searches - Teltech offers access to over 1600 online databases. Searches are assisted by Teltech knowledge analysts. When a client calls Teltech for a literature search, he or she dials into Teltech computers. The analyst explores the search topics by telephone with the client and then accesses the appropriate databases. Using special Teltech software, the analyst can then "take over" the client's screen, displaying the formats and results of searches to the client and discussing the search. Both the client and the analyst are accessing the same screens simultaneously from different sites and are talking on the telephone at the same time. After useful sources have been located, the search results can be saved or printed by the client. The average search interaction takes 25 minutes.

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3. Vendor Service - Teltech found that clients were often interested in whether vendors existed for particular technical products or services; it now offers a vendor search service. The service begins when the client calls and describes the desired product or service (e.g., an aluminum smelter with extra-wide casting capabilities to produce a new product component) over the telephone. Then, using a combination of databases, printed buyer's guides, and the Teltech expert network, the analyst locates a likely vendor. The analyst calls the vendor, confirms that it offers the product or service, and discusses availability issues. The client is then given the results of the search. The search frequently requires the analyst to get more information from the client, e.g. technical properties and typically extends over two or three days.

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4. Technical Alert Service - A logical extension of Teltech's work in information management was proactively supplying information on topics deemed critical by Teltech clients. Technical Alerts are weekly briefings for clients provided via computer on the most significant technical developments from researchers around the world. There are several different types of alert services, such as materials, coatings, sensors, and biotechnology. Because the Technical Alert analysts directly contact researchers, in many cases Teltech clients can hear of technical advances well before they are published in trade and professional journals.

Teltech services can be accessed by phone, fax, computer dialup, or Internet. About 70% of service requests arrive by phone, though the Internet channel is growing rapidly. Teltech can deliver the results of its searches across multiple media as well. Until recently, Teltech asked clients to schedule literature searches in advance; now, however, it responds to client calls in real time.

Teltech has approximately 160 employees. A large proportion are knowledge analysts in the expert network, assisted search, and vendor services. The company also has a group of "knowledge engineers" who structure the information in Teltech's databases; this process is described below. Another group of employees works on information systems for new products and services. In the field, each client typically has two Teltech personnel assigned to it: a sales person, who sells the Teltech service to clients (typically to a vice president of technology or R&D) and a facilitator, who trains client personnel in the use of Teltech services, attempts to increase usage, and addresses problems or barriers to use when necessary. Other employees work in administrative or management functions at Teltech headquarters.

Unlike many information providers, therefore, a high percentage of Teltech's resources are focused on adding value to information. There are many sources of information for Teltech's chosen market, i.e., the technical professional. Few information providers, however, are as broadly focused on providing useful information and expertise to scientists and engineers.

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Lessons from TeltechAlthough Teltech is an information-providing company, the design of its business can be instructive for information providing functions in companies outside the information industry. Each of the lessons provided by Teltech is described below: People-Technology Hybrid Services
Teltech was founded on the assumption that people are effective guides to information and knowledge. Expert, database, and vendor searches are all mediated though the Teltech knowledge analyst. While clients are entitled to search through Teltech's expert database themselves, most do not choose to do so.

Viewing the knowledge analysts at work makes it obvious why their services are desired. Most clients who call Teltech have not perfectly articulated their information need. It is only through the dialogue with the knowledge analyst that the connection between the true information need and the available sources really emerges.

For example, one client from a textiles firm called a knowledge analyst wanting information on "biodegradable packaging." After some interaction with the knowledge analyst it became apparent that she actually wanted information on biodegradable test methods for rayon. She thought she wanted to search in chemical databases, but when she was informed that there are specialized databases specifically about textiles, she preferred to search there.

Another client from a pharmaceutical company asked for an expert or literature on "therapeutic substitutes for ethical drugs." The client first phrased the question as a scientifically-oriented information need, but upon further discussion it became apparent that the need was marketing-related. The Teltech knowledge analyst was able to elicit the true nature of the client's need, although it took 70 minutes to redirect the search and find the desired information.

The people who perform this work are unusually capable information providers. A librarian in a Minneapolis-based client of Teltech noted that, "Teltech pays better than any corporate library in town, so they tend to get the best people." Teltech personnel are also expected to undergo a substantial amount of training on information sources, search techniques, and emerging fields of knowledge. Formal and informal seminars offered recently are described in Exhibit 3. Many courses are taught by Teltech knowledge analysts themselves.

Exhibit 3
Recent Training Programs for Teltech Knowledge Analysts

The lesson from Teltech here is that purely technical approaches to information and knowledge provision will rarely add as much value as hybrid approaches. Teltech's people aid its clients in defining what information is desired, clarifying concepts and terms, interpreting search results, and knowing when and where to seek further information. Such tasks are unlikely to be the province of machines in our lifetime.

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Pointers to People
A key premise of Teltech's business model is that people are not only guides to information, but also an important repository of expertise. Teltech does not attempt to capture the experts' knowledge in a database (though within the vendor service there is a database of past search results), but only the topics about which they are expert, and the means for connecting topics to people. Capturing the knowledge itself on such a broad range of topics would not be feasible, though Teltech is investigating the feasibility of capturing frequently-asked questions and answers.

Teltech clients find it very helpful to talk to experts when they have a technical problem. As one client, a VP of Technology at an aerospace firm, stated, "There is nothing like talking to someone who has spent their entire life working on a problem." Another client described a situation in which an expert was sought to recommend the appropriate material for a new product:

It is very hard to estimate the years of knowledge the experts have. You could hardly research this in a short period of time. I would say it would take probably weeks or months to gather conclusive information. If we selected the wrong material the unit could eventually fail. Unit cost is $600. The customer's confidence in us could also be affected and we could lose the whole program ($1-$2 million).

One client noted that even when the expert referred by Teltech was not the ideal source for a problem, he or she invariably had enough knowledge about the topic to refer the client to the right expert. The client then has the option of pursuing the referred expert through Teltech.

The useful lesson here is that knowledge management is best accomplished not through copying the knowledge from the heads of people to put it in computers. Instead, computers can store databases of names and locations of individuals, who have not only raw information but also experience and expertise.

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Mapping of Information Sources
Teltech draws information from a wide variety of sources. In the assisted database search area alone, there are over 1600 databases to which Teltech has access. This is in addition to information from other Teltech services, including vendor databases and Teltech's own expert database. Clients are not always aware of all these potential sources, particularly when they must subscribe to different Teltech services in order to receive all possible useful information on a single topic. Teltech currently has access to databases of literature, of vendor sources, and of experts, but up to now these have not been integrated.

A key focus of Teltech's product development over the past several years has been the development of software providing an integrated view of sources of information on a particular topic. This capability, which Teltech currently calls the "integrated source map," is approximately six months from completion, according to Teltech managers. The software for the map has been developed, but it has not yet been populated with information sources. To do so will require Teltech to negotiate new relationships with information providers.

The idea of the product is that when a client asks (either directly to the system or through a knowledge analyst) for information on, for example, neon lasers, he or she would be informed that there are 3 experts who could be consulted, 42 patents in the area, 94 articles published within the past three years, an upcoming conference on the topic, and several federal and state codes and regulations governing the use of the devices. The information would be presented in an easy-to-understand matrix format, and the client's relationship to the information will be via a "natural language" interface.

Teltech believes that the integrated source map will be a major addition to its organizational capabilities. It will present virtually all the information that a customer might want on a particular topic. The company's plan for pricing its services once the map is available is to not charge the client when creating a "knowledge map," but only when he or she pursues and receives a particular item of information. Teltech also believes that the integrated source map may be a saleable product itself.

Particularly in a complex information environment like Teltech's, maps to information sources are an extremely valuable resource. If all sources can be integrated into one map, as is planned at Teltech, it becomes easier to use and more valuable to the information consumer. The difficulty of such mapping is evidenced by the still-pending state of Teltech's product development.

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A Structure for Knowledge
Perhaps the most difficult aspect of Teltech's services to emulate would be the structure it has established for categorization and later searching of knowledge. The difficulty comes in the level of initial and ongoing investment in the knowledge databases and biographies that serve as the basis of Teltech's services.

As an example, when clients call for access to experts, they are unlikely to always use the same terms as the experts use in describing their work. Therefore there must be some "translation" function performed by Teltech in connecting client needs to available expertise. This function is performed by knowledge analysts in combination with Teltech's online search and retrieval system, the "KnowledgeScope." The KnowledgeScope includes a thesaurus of over 30,000 technical terms. It is maintained by several full-time "knowledge engineers," who add 500 to 1200 new concepts per month to the database and remove outdated ones as well.

Each technical term has a preferred usage and several possible synonyms. Teltech's goal is to have the terms in the database that are used by clients. Therefore, each day the knowledge engineers receive a list of terms sought unsuccessfully in the database by knowledge analysts or clients accessing the database directly. Many of the unsuccessful searches are misspellings (one client, for example, searched for information on "tomatoe;" whether this user was Dan Quayle could not be confirmed by Teltech), but valid misses are added to the database. Only the knowledge engineers are able to add new terms or concepts, but the knowledge analysts often suggest new terms through electronic mail or face-to-face conversations with the knowledge engineers.

Until two years ago, Teltech's approach to structuring knowledge had been hierarchical, rather than thesaurus-based. Its previous database was called the Teltech "Tech Tree" and had several key knowledge branches, including scientific/technical, medical, chemical, etc. However, both clients and knowledge analysts found it difficult to navigate through the tree, and new terms tended to be added at inappropriate levels of the tree. Teltech has found the thesaurus approach to be much more satisfactory.

Teltech also maintains a database of expert biographies, which is linked to the thesaurus through keywords. Each expert is asked on being recruited by Teltech to fill out a detailed biography form. Teltech then constructs a set of keywords that link each expert to the concepts in the thesaurus. A textual description of the expert is also created, which can be read in whole or in part by knowledge analysts as they describe an expert to a client, or as the client accesses the biography directly. The expert biographies are updated annually to reflect new expertise and new terminology. Further, new experts are always being added to the database.

Teltech's efforts in creating a structure for knowledge are instructive for other types of firms. If knowledge is going to be captured and leveraged, it must first be categorized. The thesaurus-based approach employed by Teltech may be promising for many situations, since knowledge is usually communicated and sought in words, and words are the primary unit of knowledge in a thesaurus.

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Focus on Information Behavior
Teltech is highly oriented to the "information behavior" of its clients, i.e., how they seek out, use, share, and manage information. In conversations with Teltech employees one often hears references to research or experience about the information behaviors of technical professionals. In such cases, Teltech attempts to respond to the behavior, as described below for several examples: Engineers may not want to admit they don't already know the answer to a question, so Teltech attempts to create an environment in which clients can take credit for information acquired through Teltech;

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There are no general rules about how to manage information behavior. But Teltech undertakes many projects and actions to try to improve the information behaviors of clients. Individual knowledge analysts reported, for example, that they must often "sell" the idea of calling an expert to a client. One knowledge analyst enthusiastically described the capabilities of an expert to a client, and then added, "I've talked to him before, and he's very approachable. Why don't you go ahead and give him a call."

Teltech has also found that technical professionals are highly motivated by seemingly insignificant technical "toys." One of Teltech's marketing approaches is to offer new expert searchers a pen that has a bulb on the top in which a liquid boils from the heat of a finger applied to it. At conferences the company hands out "Tech Pets," small pieces of plastic that rotate in mysterious ways; clients are urged to seek the reason for the device's strange behavior from "Dr. Bovee," an imaginary expert who is listed in the database. These trinkets motivate technical professionals through their technical curiosity.

Finally, Teltech also attempts to influence information behavior through the "gatekeepers" for external information in firms. One such group is librarians; where librarians exist in firms Teltech attempts to cultivate their understanding and good will toward Teltech. Some librarians are threatened by Teltech services, feeling that using them reflects poorly on the information they provide to clients. Other librarians are content for their technical professionals to use Teltech for expert discussions, but encourage use of their own database search services.

Teltech also attempts to cultivate senior technical or research managers, who typically agree to sign usage agreements with Teltech. Their active encouragement of Teltech use by technical professionals can have a major influence on information behavior. One senior Teltech client executive described how this works:

When I am being given a presentation on the status of a project, I will ask the project team, "Did you check with a Teltech expert to see if that is a viable concept?" At first all I got was "no" for an answer. But now they see that I am serious about it, and they are starting to turn to Teltech much more frequently.

Teltech provides senior client executives with a monthly Service Summary each month, which notes who has used the service and what type of expertise they were seeking. As one client librarian noted, "Occasionally we see that someone is working on a hobby and seeking expert advice on it. But there is very little incidence of abuse." Teltech also provides a newsletter for senior client executives called "KnowledgeNotes: News for Leaders of the Knowledge Revolution."

The best knowledge management environment is of little value unless the knowledge is used. Teltech's focus on information behavior is not motivated by philosophy but by good business sense. If technical professionals do not seek out Teltech's expertise network, Teltech makes no money. Even in companies where the primary product is not information, internal information providers should follow Teltech's lead. At some point they will be evaluated on how their information is used.

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SummaryTeltech is a bellwether of new practices in information and knowledge management. It has created a successful business out of a set of practices that can and should be adopted by firms who are not primarily in the information business. The information management innovations described above are relevant to almost any firm. As evidence of this relevance, Teltech personnel are increasingly being asked not just to provide external expertise and information, but to help their clients design new knowledge management environments.

But adopting the lessons from Teltech will not be easy in the current business environment. Teltech services go "against the grain" of information management approaches in most firms. They are labor intensive, requiring personnel with both good information skills and good people skills. They require substantial investment in technologies and information sources. They involve developing close, long-standing relationships with information customers, and in many cases mean changing customer behavior, which is always difficult. The challenges of following the Teltech model are attested to by the absence of direct competitors for Teltech.

In short, while many companies talk about knowledge management, "the learning organization," and intellectual capital, Teltech is one of the very few companies that can claim to be putting these concepts into practice. As usual, it is much easier to talk about important management innovations than to do something about them.

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Last modified: February 01, 1998
Graduate School of Business, University of Texas at Austin