As
most of you know, I recently spent ten years as CKO of a large
professional services firm. I quit to start my own business -- writing
books and consulting mainly on business innovation and entrepreneurship. My
reason for doing so was not that I believed knowledge management (KM)
was no longer important. Rather, it was out of frustration over the
widening gulf in attitude to KM between senior executives (caught up in
the 'cult of efficiency' and shareholder demands) and those whose job it was to 'make KM work'
in organizations: researchers and analysts, website and database
managers and creators, community of practice facilitators, librarians,
trainers and technologists etc.
Peter Drucker has identified
improving the effectiveness of front-line knowledge workers as the
"most important management challenge of the 21st century". In so doing
he pointed the way forward for KM: Work effectiveness and personal
productivity improvement, personal content management, creating 'simple
virtual presence', people-finders, expertise-finders and other know-who
and know-how (rather than know-what) directories and resources. But
despite this, and our growing awareness that knowledge sharing and
collaboration is the key to business success (and perhaps even saving the world),
we seem unable to articulate the value proposition for KM compellingly
to those who set budgets and allocate resources in major organizations.
So expenditure on KM is in long-term decline, and the knowledge
'function' is being deemphasized or folded back into other back-office
groups in many organizations.
Things are the way they are for a reason, and this
'appreciation gap' in the value of KM is not that hard to explain. Just
as progressives and conservatives can talk themselves blue in the face,
futilely trying to explain their point of view to the other side, so
too are the frames of reference of those in the corner offices of large
corporations are very different from those of KM leaders and their
'customers', the front-line workers:
Business leaders must
take a short-term focus, to meet the demands of shareholders, while KM
leaders often feel that investment in knowledge, learning and
technology needs longer to pay off.
Business leaders are
accustomed to knowledge being transferred top-down (instruction and
formal training programs) and information for decision-making being
polled from the front lines. KM leaders believe that critical knowledge
transfers are more often peer-to-peer sharing, coaching and
facilitation.
Business leaders see their leadership role as
critical to the organization's success; their frame of understanding is
hierarchical -- they tend to believe that knowledge and value increases
with experience and that rewards should go disproportionately to
identified superstars and up-and-coming leadership candidates. KM
leaders see contribution to organizational success as more egalitarian,
and are more likely to believe (as Drucker says) that almost every
employee today knows how to do his/her particular job better than
anyone else (including the boss) -- they may see large wage and reward
disparities as demotivating and unwarranted.
Business leaders
tend to see value in centralized repositories of 'best practices' and
SOPs, and the reuse of knowledge collateral. KM leaders are more likely
to see the value in context-rich conversations between peers, 'pointers
to people', mining the content of front line people's desktops, and
tools that enhance collaboration and innovation.
Business leaders are likely to perceive the major 'knowledge problem' in organizations as being inefficiencies:
'reinventing the wheel' and underusing available knowledge 'on the
shelf', and hence the perceived poor ROI in investment in knowledge,
learning and technology. KM leaders are more likely to see the major
knowledge problem as ineffectiveness: time wasted trying to find appropriate experts and knowledge (often on their own desktops), and 'the cost of not knowing'.
I
am convinced that the current deemphasizing of KM is a tragic mistake
that will have serious long-term consequences, for these reasons:
Most
of the critical problems in organizations could be solved if the right
people with the right knowledge came together and collaborated
just-in-time to address them.
Most of the time spent by
employees when they're using computers is wasted. Some studies indicate
that as much as 30% of employees' time is spent looking for information.
The
Cost of Not Knowing is astronomical, and we're just starting to realize
how much more expensive not knowing is than the cost of knowledge.
Enron, Mad Cow, Avian Flu, even 9/11 were essentially knowledge
failures.
The Wisdom of Crowds
can allow organizations to make much better decisions at lower cost
than reliance on management 'gut feel' or outside 'experts'.
In
the next 10 years we are likely to see a major crisis of confidence in
corporate conduct -- more frauds, lobbying government for indemnity
from outrageous behaviour, massive business failures (when interest
rates spike and consumers get so deeply in debt they stop buying),
inexcusable bailouts and subsidies, and the consequences of social
(offshoring) and environmental (pollution and health issues)
indifference etc. Only through KM can the issues that could precipitate
this crisis be addressed and the reputation of business saved.
In
the next 20 years a combination of horrific US government debt (making
massive corporate subsidies unaffordable) and the shift of power
(itself knowledge-driven) from producers to consumers is likely to
bring about a major shift from large corporate oligopolies to a 'world
of ends' of networks of agile, entrepreneurial companies. Knowledge
will power every facet of this transition, and companies that invest in
KM are much more likely to survive it.
If oil prices continue
to rise steeply (and there's evidence that, after some whipsawing over
the next few months, they'll head even higher), the cost of
transporting businesspeople to meetings is going to become prohibitive.
We will need ways to meet and share knowledge in real time, virtually,
effectively and simply. Significant investment in knowledge, technology
and learning will be needed to make this happen.
The worldview
of most CEOs is responsive, risk-averse, conservative, frugal and
short-term focused. Here is what some of them have told me about each
of the seven points above:
"You may be right, but the
problems we face today are not sufficiently critical or urgent to
motivate us to expend significantly more on knowledge, learning and
technology than we do today".
"That's the employee's
responsibility. If they're wasting that much time, it would seem more
logical to fire those employees and bring in some others who are more
technologically competent, rather than investing a bunch of money
retraining non-performers."
"It won't happen to us. We have good people, good risk management programs, good leadership and good systems."
"Don't tell me, show me."
"Not my problem. Not my responsibility. Not going to happen."
"You're overstating. Won't happen that fast or to that degree. And 20 years in business is eternity. The world might end first."
"There
is not and never will be a substitute for real-time face-to-face
meetings. We'll have to find some more economical way to transport
people instead."
I completely appreciate these senior
management perspectives. I used to share them. But senior management is
heavily buffered from the problems and frustrations of people on the
front lines -- they have people to do their 'knowledge work' for them,
and subordinates are not rewarded for passing along front-line
complaints to CEOs (they're rewarded for solving them inexpensively or
pushing back on them). And I'm increasingly convinced that this
ignorance of the aggravation of people doing their best on the front
lines -- not being able to find the people, experts and knowledge they
need (sometimes even when it's on their own hard drive) to do their
jobs properly is at the heart of problems as diverse as low
productivity, lack of work-life balance, high turnover of 'stars' (and
the need to pay them exorbitant sums, and everyone else inordinately
less, to keep those stars), dissatisfied customers, employee burnout,
lousy service and high employee illness rates.
It's like the
frustration we all feel when we have a straightforward repair job to do
but don't have (or can't find!) the right tool to do it. Lots of time
wasted looking for stuff (often fruitlessly) and work that's
ineffective (or stop-gap or work-around). Knowledge workers face this
frustration constantly -- and I believe it's through no fault of their
own.
That's why I am convinced KM will play as crucial a role
in the 21st century business world as automation did in the 20th. If
only we can find a way to articulate its value to those who need to
fund it!
We
hosted the annual neighbourhood BBQ yesterday, so this week's 'best
links of the week' post is a little late. Another post to follow later
today.
The Innovation-Centric Company: From Roger Smith
at the Fast Company Blog, what it takes to be a company that is centred
on innovation, rather than short-term profit. "A company must
demonstrate that their innovation moves them from a customer's current
needs to their future needs before the customer gets there. Customers
will learn which companies can only satisfy today's problems and which
are already imagining and solving the problems they will have in the
future. The innovation-centric company is establishing itself as a
lifelong partner."
Open Space to the Gift Economy:Proceedings
of last year's Open Space events exploring how we can bridge to the
Gift Economy. Some fascinating stuff here I'll write more about later.
Thanks to Chris Corrigan for the link.
Revolution in the Maldive Republic: There's a pro-democracyuprising
in the Maldive Islands (bet you've never heard of this country) and the
only media covering it are the bloggers. Would the MSM be there if it
were an oil nation?
State of the Blogosphere:David Sifry
at Technorati has an interesting 5-part review of what's happened in
the past year in the blogosphere (scroll down to the 5 parts in reverse
order). More bloggers, fewer readers to go around? Read it and find
out. Some great graphics, like the one above, Ranking of How to Save the World by number of other blogs referring to it each day
BlogPulse Blog Profiles: Some interesting data on your personal blog can be found on Intelliseek's BlogPulse site. Put in your blog URL and learn.
MADE IN CANADA
trust your
instincts 
As
most of you know, I recently spent ten years as CKO of a large
professional services firm. I quit to start my own business -- writing
books and consulting mainly on business innovation and entrepreneurship. My
reason for doing so was not that I believed knowledge management (KM)
was no longer important. Rather, it was out of frustration over the
widening gulf in attitude to KM between senior executives (caught up in
the 'cult of efficiency' and shareholder demands) and those whose job it was to 'make KM work'
in organizations: researchers and analysts, website and database
managers and creators, community of practice facilitators, librarians,
trainers and technologists etc. 
