Leveraging Organizational Knowledge

The multichannel challenge

2011-04-03T16:21:00.002+01:00

I have not written on this blog since July 2010. It is not that I was struggling to find topics, but more a lack of time: my current interim contract with Matches Fashion and the adoption of an adorable child finally becoming a reality just took their toll on my spare time.

In the April 1^st edition of Retail Week, I read an interesting supplement with same title as this post (in the print version) that motivated me to start blogging again. This supplement contains a lot of good comments but I will highlight a few here.

Ok, it’s a word now, so we can write “multichannel”, no longer having to write “multi-channel”. Every one in retail is now more than just talking about it, as it must have a prominent position in every retailers strategy.

But critically, retailers are finally understanding what multichannel really means. It’s not just about adding one more channel to market, it is about providing integrated and seamless services to your customers. A transaction can then involve 2 or more channels ideally at no extra costs and in a very flexible way.

Darryl Owen, the SAP head of retail for EMEA, provides a short list of must-haves for a multichannel software solution:

· Centralised data, including master data and transactional data.This is about full and true integration between all systems supporting the various channels. One system must be the holder of the single truth.

· Real-time IT infrastructure.As technology enables customers to be always connected, they will expect real-time information with all channels. So if your tills poll once/day, here is one priority for you to change.

· Accurate data analytics.Reporting must be consistent throughout the channels. This means for instance that each customer or each product have the same unique identification across channels.

· The ability to think ahead.This is absolutely key for success and competitive advantage. Your systems and business processes must be fully flexible to associate existing channels differently or incorporate new channels no one has even thought of yet.

I would like to comment on the “multichannel shopper” article as well:

<<In December, Deloitte surveyed 2,000 multichannel consumers to find out about their shopping habits. Shoppers’ expectations are shifting as quickly as their behaviour. Deloitte head of multichannel Colin Jeffrey says: “What one retailer offers as a new service quickly becomes the expected. Customers will struggle to understand why others don’t have the same.”

The research showed that on average multichannel customers spent nearly twice that of their store-only peers, with multichannel customers spending an average of £130 per transaction compared with £67 for store-only transactions and £113 for internet-only customers.>>

Being a multichannel retailer is first about providing new convenience to existing customers rather than increasing sales. However, as Deloitte’s research showed, multichannel customers tend to spend more. So for instance, when using a click & collect in store service, a customer might purchase additional products while in store collecting the order placed online.

A key point to realise is the speed of change with multichannel customer behaviours. Success will not be about playing the crystal ball game about what is to come, but to transform the organisation’s systems, processes and culture, so as to be as flexible as possible to adapt to any new technologies and customer behaviours while remaining competitive.

Knowledge management is the process of leveraging organizational knowledge

2010-07-09T06:39:00.000+01:00

In their paper "Strategic planning for knowledge management implementation in engineering firms",

Ravi Shankar, (Ravi Shankar is an Assistant Professor in the Department of Management Studies, IIT Delhi, New Delhi, India.), M.D. Singh, (M.D. Singh is a Senior Lecturer in the Department of Mechanical Engineering, Motilal Nehru National Institute of Technology, Allahabad, India.), Amol Gupta, (Amol Gupta is a Student in the Department of Computer Science, TIT&S Bhiwani, Haryana, India.) and Rakesh Narain, (Rakesh Narain is a Senior Lecturer in the Department of Mechanical Engineering, Motilal Nehru National Institute of Technology, Allahabad, India.) seem (have not yet read it) to define Knowledge Management the way I have done since 2005 (hence the title of this blog!):

<<Knowledge management (KM) is the process of leveraging organizational knowledge to deliver long-term advantage to a business and is based on a business strategy that involves engineering various knowledge-centric business processes and developing organization structures to support these. These, in turn, require technology to capture, codify, store, disseminate and reuse the knowledge. Successful deployment of KM is not a simple process. This paper suggests that a major reason for the failure of many KM projects is the absence of a well-defined strategic plan to guide implementation. This paper discusses the strategic planning needs of the KM deployment process, and develops a framework that could be used specifically by engineering firms to guide the KM implementation process.>>

I have also argued in several posts that KM cannot truly succeed if it is not adressed strategically.

Scaling up with social media: luxury brands have a natural advantage.

2010-06-13T06:29:00.000+01:00

Jeremiah Owyang recently did a presentation on how companies can scale up with social media technologies. Do read it. His starting observation is that customers (let alone prospects) will always outnumber a company's total workforce (let alone the ones formally responsible for customer relationships). Since social media puts companies in "direct" contact with a growing number of people, they are in danger of counter-productive social media initiatives leaving most customers or prospects frustrated for lack of response from the company to their queries/issues/concerns.

Jeremiah suggest 3 good strategic solutions to this problem:
<<

Using all the voices in your ecosystem (the Rings of Influence) not just being the only ones to talk.
Develop more customer to customer technologies that leverage your customers to do your marketing, sales, and support.
Invest in Social CRM systems, while immature now, they will eventually help companies respond in real time –and maybe even anticipate customer need.

>>

Reading this, I realised it was confirming my position that luxury goods and services companies are the best suited for an effective social media strategy: their ratio "number of customers/number of employees" is by nature the lowest! So, they can realistically connect with a large number of customers by involving all their employees for instance. Luxury brands can be more in control of what is being said about them in the socialsphere than FMCG brands.

A hint that Burberry is on the right track about social media integration

2010-06-02T17:47:00.001+01:00

In my last post, I wrote that I didn't know of a retailer that is yet offering a fully integrated multi-channels experience. I have however just discovered that Burberry's own social media site www.artofthetrench.com might indicate that they are on the right track towards this full integration. The site allows a Facebook account connection (in fact imposes it) before uploading your own trench coat pictures. This of course does not mean that Burberry will implement this type of integration on its ecommerce site but it's a start.

PS. I am not suggesting that a Facebook account should necessarily give you access to all ecommerce sites! Social media is not just about Facebook for a start, and a social media strategy should not be application dependent anyway. If the technology might still need to be defined, the goal is clear however: offering an integrated and consistent multi-channels customer experience and follow each customer as a unique individual through all channels.

Loyalty cards are about customer knowledge, next step: integration with social media

2010-05-31T19:29:00.000+01:00

Despite its recent loss of market share, Asda continues to argue that its lowest price policy is a better strategy than its main rivals’ loyalty card schemes. I think they are wrong but not with respect to prices but because of the valuable customer data they are not collecting. Asda simply does not “know” its loyal customers.

In Retail Week May 28^th 2010 edition, there is an interesting article about customer loyalty: “Loyalty cards: the bedrock of future success?”

<<[David Roth (former B&Q marketing director, now chief executive of the Store WPP)] observes: “The world is going to divide between those who can organise and make use of their customer data and the others, who will wake up in five or six years’ time, outmanoeuvred. The person who owns the data, owns the customer.”
But he maintains that loyalty schemes are primarily a means to an end and will not on their own make a retailer successful. He says: “Gaining customer loyalty is about a lot more than a scheme. The value proposition will be important.”
For all the interest in loyalty and the success of some programmes, they will never be a panacea for retail’s ills and typically cannot answer one vital question. As [James] McCoy (Yougov SixthSense research director) says: “Loyalty schemes can tell you what people are buying - but not what they’re not buying. As well as whatever they are spending at one retailer, they might be spending another £40 a week at Lidl, which you have no idea about. The challenge is to find the data you don’t have.” >>

David Roth and McCoy are absolutely correct. In the FMCG sector, loyalty schemes will increasingly be a necessity for commercial success but will not be sufficient by themselves to ensure competitive advantage. Competitive advantage will first come with what is done with the information collected at the till. Tesco Clubcard is a perfect illustration of this: I am a Tesco customer and I receive at home personalised mail including discount coupons for products that I am likely to buy based on my purchase history.

However, the true Holy Grail of competitive advantage is not in the customers’ purchase history data, it is with the knowledge of what they want but cannot find or afford, what they might buy if they were made aware of it or if it was conditioned differently, what they buy with the competition, etc… The most valuable customer knowledge will not come from transactions at the till but from engaging with customers to get them to tell what their needs and wants are. Luxury goods retailers have known this for centuries and have always valued and leveraged the in-store customer knowledge obtained by the salesperson through the conversations with his/her “loyal” customers.

So FMCG retailers will need to engage with the customers registered in their loyalty scheme. Since they will have to do this through all channels, it will require a holistic approach to customer identification: So this means one account per customer for all channels. This might seem obvious but I have not yet come across a single retailer (from FMCG to luxury) with such a pervasive integration strategy. For instance, all retailers with a Facebook page do not integrate the Facebook account with the ecommerce customer account: This means no systematic way of tying up a customer’s comments on Facebook with his/her online (let alone offline) purchase history.

<<Tesco is one of the most advanced of retailers in its ability to mine customer data and use it effectively and, notes Shore Capital analyst Clive Black, has put its scheme at the heart of its business, rather than run it as an add-on.>>

Similarly, in the next few years, retailers will gain competitive advantage from putting social media and all customer interactions at the heart of its business, rather than run it as a an add-on.

There should be no box to begin with!

2010-04-29T16:05:00.000+01:00

I was recently reading the profiles of the Association of MBAs regional committee and this phrase attracted my attention:
"[Derek Chesire believes] that 'out of the box' thinking does not exist: there simply should be no box to begin with".

Yes absolutely! I like this simple way to put it. I suppose what he really meant is that out of the box in fact does exist but is mostly ineffective at generating innovation and competitive advantage.

An organisation with a culture not conducive to creativity where knowledge sharing and spontaneous collaboration is not encouraged and rewarded, will eventually feel the need to ask from its employees to "think outside the box" in the hope that some good ideas will come out of the exercise. Out of the few good ideas that might come out, only very few of them (if any) will lead to an innovative implementation. This is because this process (idea through to implementation) requires an environment where mistakes are not only permitted but encouraged, where work outside initial job description and spontaneous collaboration is natural and rewarded.

When an organisation with an organisational culture not conducive to knowledge-sharing and creativity ask its employees to be creative, it is a bit like asking a group of junior mechanics to build a racing car from a pile of spare-parts, without the authorisation to collaborate with one another! You might obtain a car eventually but very unlikely competitive.
It's much more effective to let the group of mechanics organise themselves as a team and let them work out what they can build together. That way, they could come up with the next F1 concept car!

How will luxury Brands be creatively different with ecommerce?

2010-04-08T16:38:00.000+01:00

Read Fadi Shuman’s (Pod1) very informative article about ecommerce in the luxury market.

Fadi might be correct that “2010 will be the year that the majority of [the luxury] brands jump on the e-Commerce bandwagon”. The latest purchase of Net-a-Porter.com by Richemont supports this statement. But I have yet to be convinced that these same brands have worked out a way to reproduce on the web what made them different on the high street: uniqueness, exclusivity, high quality, dream-making image, personalized customer services, refined and luxurious stores, best store locations, etc… As Marci Ikeler (Publicis) puts it in her excellent slideshow I referred to in a previous post :

“How do we use the web to tell a luxury story?” Or “How do we recreate the sensorial experience of the brand online?”

Fadi refers to Faberge and its site with a very exclusive access or the ecommerce pioneer Burberry’s use of social media for an interactive approach around its catwalk shows. Marci does provide other examples or innovative online initiatives from several luxury brands but we have yet to see the same level of creativity and innovation with their ecommerce.

I have checked out several (ok not all of them, but let me know if I missed one that contradicts my point and that will be the exception that confirms the rule as we say in France) of the oldest or more recent luxury brands’ ecommerce sites (Cartier, Burberry, Prada, Louis Vuitton, Dior, Dunhill, Gieves and Hawkes ) and all of them failed for me at the first main hurdle, well before making the first purchase! And this is a key feature of a luxury brand store: the special experience starts with the shop windows and continues throughout your visit of the store through primarily excellent customer service, even if you end up buying nothing. Before leaving you might have exchanged a lot of valuable information with one (or more) sales staff. You might have given for example your contact details, your preferences, your sizes (for clothes). You might have been told specific details about products of interest, what is in stock, what is about to arrive or about to run out, what is very popular, etc… I am assuming here that you are a new visitor to the store, not yet a customer of the brand.

Now, what did I mean by stating that the luxury brands failed this first hurdle related to the pre-sale experience? Well, let’s start with the fact that for most of the sites I visited and browsed the products available to purchase online, my visit has only contributed to the website analytics but the brand does not know I – as a specific person – visited its site. This is simply because my credentials were to be requested only at the purchasing stage. Worse, in most cases even though I was willing to provide my details, there was no way to do this without buying something! Gieves and Hawkes, Dunhill and Louis Vuitton did cater for a pre-sale registration. However, in both cases the benefits of doing so are limited and lack creativity. Typical facilities available once registered are:

Create and share your personal wishlist
Expedite the check-out process
Receive special updates and promotions
Modify your account details at anytime
Check the status of orders
Recording alternative addresses
View past orders

These are basic services that most non-luxury sector ecommerce sites have been offering for years. Luxury brands should do much better to create a more personalised and special online experience.
For instance, once logged in I would expect a personalised experience wherever my web browsing takes me within the brand’s online world. So my account should follow me around so that I do not need to log in/register again on different pages. Of course, another benefit could be a personalisation of the content on each page based on my preferences (I have other ideas but wont give them out for free!).

For example, Gieves and Hawkes has a Corporate Blog on its site. This is good but unfortunately, even though I was logged in on the main site, I would have had to enter my credentials again in order to leave a comment. This lack of integration is not just about a lack of user friendliness, it does also highlight a lack of or poor multi-channels and multi-media CRM strategy. In the luxury business, knowing your customers well and your customers to know you well is so vital for competitive advantage that it is starting to defy belief why luxury brands are following on the FMCG brands footsteps rather than lead the way.

Brands need an online social media strategy

2010-03-29T07:51:00.002+01:00

Jeremiah Owyang is right, a Brand should not “throw away” traffic on its corporate site by inviting visitors to join the Brand profile on Twitter or Facebook or other social site without a well thought strategy. It is a bit like sales associates of a high street shop telling visitors on their way out: “We invite you to visit us at our small corners inside most department stores”. This might seem to be sending the positive message “we’re present in these locations” but it might lead to the visitors buying at other Brands also located there as well as not coming back to the original store! The same as sending a visitor of your Brand website to twitter where he/she will receive twits from many other Brands, is likely to lead to another Brand attracting more of his/her attention, and not have him/her visit your site again!

A Brand does typically spend much much more on its own website than on its social networks presence (if it has one) so if not careful, doing so might mean actually losing these visitors as potential active fan of the Brand, to become at best simple passive observers of some Brand-related activity.

However, I am not convinced by Jeremiah’s matrix on the Evolution of Social Media Integration and Corporate Websites. Or rather, I do not see it as a “must follow this path” for all Brands. Let’s just take the last stage for example: “Complete integration between corporate site and social sites”. I can think of most of the Brands in the luxury goods sector that would not benefit from such an integration. This would lower the Brand name status too much to the level of just another network relation such as a friend on Facebook. The Brand would risk losing its exclusive image, its capacity to generate and fulfill dreams. Luxury Brands would need to maintain this image online and a complete integration with social media would make this difficult.

Marci Ikeler from Publicis has a very good presentation on slideshare “Digital strategies for luxury Brands”.

Digital Strategies for Luxury Brands

View more presentations from Marci Ikeler.

She mentions the successful examples of Gucci on Facebook and MAC on twitter, both of which support the Brand image instead of “cheapening it”. I noted this statement supporting Jeremiah’s first point: “The most successful luxury digital campaigns are fully integrated with a larger digital strategy and align with the brand’s values”. But do not confuse this with a complete integration of the Brand’s website and social media!

You must read the chapter 10. Use digital to convey exclusivity (slides 43 to 45). It shows 2 examples of exclusive social networking, illustrating why complete social mass media integration will not be beneficial for all Brands.

Enterprise 2.0 is not a game anymore, it's serious business

2010-03-24T10:56:00.000Z

Another good post from Bertrand Duperrin following the Enterprise 2.0 Forum in Paris on March 17th/18th.

His bullet point list of conclusions is good news for everyone (like me) promoting the uptake of E.2.0.

I will highlight the following 4 points:

It’s not a game anymore. Now projects are global and carried by the top management. That’s the end of social bubbles disconnected from reality. Companies think global and pilots are not made to test but are the learning stage before global rollout. I really appreciated Claire Flanagan’s approach that set a time limit (5 month) instead of limiting the number of users what allowed her to quickly get a critical mass (nearly 30 000 users) with an opt-in policy.
Tools come second. We talked a lot about management, culture, governance. 90% speakers did not even mention the name of the platform they used and, in fact, the question is elsewhere (even than there’s always the same usual drudge in every conference). The best example comes from Danone where the “networking attitude” program was launched in 2003. It’s all about management and behaviors. Management 2.0 without web 2.0 tools. Tools came only when the behavioral dimension was natural in people every life in the workplace.
There’s no “one size fits all” adoption model. Each company has to define its own way depending on its culture and on local cultures.
Support from top management. That’s been known for ages but it’s clear that a bottleneck appears when top managers are not active sponsors. I don’t mean being benevolent from a distance (”ok…let’s go guys…I’m watching you play..”) but being able to understand the change, make it theirs and imagine them, their staff and their behaviors in the future, be comfortable with it to be an active sponsor.

I (and many others) have been writing for years now about the importance of a strategic consideration, visible top management leadership, conducive corporate culture, adapted management behaviours and internal processes for the successful introduction of knowledge-sharing tools in an Organisation. Looks like business leaders are finally getting the message.

TCS KM maturity model and implementation methodology

2010-03-04T14:26:00.001Z

Tata Consultancy Services (TCS) have defined a simple KM maturity model and a KM implementation methodology (SIGMARG)
Their maturity model for an Organization is as follows:

1. Initial - Organization has no formal processes for using organizational knowledge effectively for business delivery.
2. Intent - Organization realizes the potential in harnessing its organizational knowledge for business benefits.
3. Initiative - Organization have knowledge-enabled their business processes and are oberving its benefits and business impacts.
4 - Intelligent - Organization has matured collaboration and sharing throughout the business processes that results into collective and collaborative organisational intelligence.
5. Innovative - Organizational knowledge leads to consistent and continuous process optimisation giving it a business edge.

If the speed at which an Organization go through the stages will vary greatly, the authors do stress that an Organization must go through these stages in this order and they are "no shortcut" to the innovative level, and they are absolutely right. A young company with the right leaders might start at level 3 but would need to go through level 4 before reaching 5.

Having said that, what is important to understand here is less the number of levels and their definitions, but more the fact that a KM strategy cannot be underestimated and will involve a difficult journey requiring strong leadership, committed resources and patience.

The authors are also correct in identifying the 3 main building blocks (or "pillars") of Knowledge Management:

People and Culture (the "soft" pillar)
Technology (the "hard" pillar)
Process (the "glue" pillar)

A KM strategy must be concerned in taking these 3 pillars through the 5 stages of maturity.

Minimal information is given about the SIGMARG implemenation strategy (for obvious reasons) but you would expect it to rely on a set of benchmarking tools to assess the current state of the 3 pillars, followed by a roadmap of how to take them through the maturity levels. For the most important (in my view) pillar "People & Cutlure", my list of cultural traits not conducive to knowledge-sharing could be such a tool to assess the corporate culture for instance: the more of the 20 traits relate to your Organization, the deeper it is stuck at level 1. I would expect a level-5 Organization not to have a single of these traits.
The next pillar in importance is the Process pillar. This is primarily to ensure that KM is embedded in all business processes and not considered as an additional activity on top of the regular daily activities. This is not a simple endeavour and will require process re-ingeneering. Ideally, the Organization needs to become process-based instead of function-based.
Then only comes the technology pillar to facilitate the cultural and process changes by making them pervasive and time-resistant.

W.L. Gore & Associates: A workplace that epitomize the corporate culture conducive to knowledge-sharing I keep bragging about

2010-01-28T14:57:00.000Z

Check the full news article on the W.L. Gore & Associates website but here is the extract that made my day:

[..]
In addition to its diverse innovations, Gore is known for its unique, team-based culture and flat management style. President and CEO Terri Kelly said Gore remains true to its core values, even in the face of challenging business conditions.
"We recognize the importance of fostering a work environment where people feel motivated, engaged and passionate about the work they do," she said. "In difficult economic times, the true values of an organization are tested, and I am proud to say that our associates have rallied together to make the company stronger than ever. Our culture promotes an incredible level of ownership and entrepreneurship. It encourages associates to channel their talents and interests to produce a continuous stream of innovative, high-value products for our customers."

[..]

How many more successful example like this one do most leaders need to be convinced that this is the right type of corporate culture in the Knowledge Economy?

Are the consulting firms partly to blame for the fact that only a relatively small minority of companies have adapted their internal culture to the knowledge intensive economy?

2010-01-04T14:48:00.001Z

Last month (Dec 09) I posted this question on Linkedin:

Are the consulting firms partly to blame for the fact that only a relatively small minority of companies have adapted their internal culture to the knowledge intensive economy?

In so few companies are collaborators incentivize to internally share freely their valuable knowledge (and rewarded for it). I would think that if consultants were to start advising "en masse" their clients about the benefits of such cultural change, "knowledge focused companies" could become the norm, not the exception. This question concerns only the companies that do call in consultants (however, the others do get to learn of successful cases so could benefit indirectly). I am assuming also that most consultants would be aware and agree about the knowledge sharing benefits but maybe this is being optimistic. As for the competitive advantage of a knowledge focus culture, I believe it is not an assumption but a fact.

This question received 16 answers. About 5 disagreed with the suggestion that consultants have to share the blame for the lack of organizational knowledge-sharing. A couple seemed “neutral” on this point. So, a majority seemed to agree.

I particularly liked how Nerida Hart put it: <<I think that what is happening is that the 'big' consulting companies only tell their clients what they think they want to hear - rather than - guess what guys you have a massive cultural problem and it won't matter what I write in the final 'report' - unless you want to address these issues nothing will change.>>

As the best answer, I chose Nicole Marchand’s:

<<Thanks for raising a subject that I really believe organization should all practice. Here is my take!

There are a few issues here that I believe contribute to the lack of buy-in, to adapt a knowledge focus culture. Are consultants responsible? As mentioned above, I believe it is a partnership between the consultant and the CEO but most importantly success is proportional to the leadership commitment to implement such an initiative. The lack of involvement at the senior level has proven to be a barrier in building a knowledge focus culture. Commitment from Senior Management is not restricted to the allocation of resources but also requires them to champion the initiatives, model the desired behaviour through the enhancement of their own learning, participation in the collaborative process, in essence; the promotion of knowledge sharing through concrete actions and consistency. Knowing that, I am honestly curious to know if senior leaders are willing and capable to commit to that extent. Could this be part of the lack of collaboration to implement such an initiative?

Another factor, because knowledge is an intangible asset, the business requirements to produce a return-on-investments and cost/benefit factor is often a huge challenge and tough sell. KM (knowledge management) practitioners need concrete evidence both qualitative or quantitative including a special place in the organizational financial statement to enhance the value of this intangible asset. (that will be my next question!) Experts report that 80% of organizational knowledge lies in the head of individuals, a fact worthy of attention.

A knowledge focus culture is a newer way of doing business. If leaders and managers keep thinking that water cooler conversations are a waste of productivity and not part of sharing knowledge and building trust and relationship, its implementation will be difficult. It requires a change in mind-set and behaviour and yes trust.

Implementing a knowledge focus culture takes considerable time, effort, energy and resources, it is the consultant’s responsibility to enhance the value of knowledge management, provide an accurate and informed assessment of the present knowledge manipulation situation, present a solid implementation plan and educate leaders on its present status and benefits. The success of the execution though, at the end of the day lies in the hands of the leaders. According to Bossidy & Charan (2002), “no company can deliver on its commitments or adapt well to change unless all leaders practice the discipline of execution at all levels” (p. 19).

There are many other factors affecting a successful implementation but I have hope I have managed to bring a contribution to your question. >>

My position is also that the responsibility is shared and successful cultural change depends on a partnership between the leader(s) and the consultant(s): “…it is the consultant’s responsibility to enhance the value of knowledge management, provide an accurate and informed assessment of the present knowledge manipulation situation, present a solid implementation plan and educate leaders on its present status and benefits.” The leader then makes it happen. However, I believe that only a minority of consultants initiate this change unsolicited. The consultant should not wait for the leader to ask them “help initiate a knowledge-focus culture”, as he unlikely knows that this is indeed what the organization needs to gain competitive advantage in a sustainable way.

Could it be that knowledge-focused companies less need to call on consultants? Since these companies make much better use of their human capital by leveraging internal expertise and talents for creativity and innovation, maybe they can do away with consultants for most problem-solving situations. I do not want to initiate another conspiracy theory but what if many consulting firm partners are aware of this and consciously refrain from spreading too quickly the knowledge word?

Corporate cultures not conducive to knowledge sharing

2009-12-05T18:10:00.003Z

I thought of reposting my list of cultural traits that identify an organization where the corporate culture is not conducive to knowledge sharing and therefore creativity and innovation. This list combines the 16 from this post and 4 from this one.

And here is a challenge to anyone reading this: Do you know one medium or large company with an internal culture not bearing a single of these 20 traits? If yes, please post a comment with its name.

1. A strictly hierarchical top-down structure: The “you should not share knowledge outside your department without your manager’s approval” syndrome.

2. Focus on short-term objectives: the “no need to share knowledge since once objectives are met, it wont be needed anymore” syndrome.

3. Reward achievements of each individual based solely on personal objectives: the “you are judged on what you achieved, not on what others have achieved with your help” syndrome.

4. Organizational silos that do not (or poorly) communicate/collaborate: the “we cannot possibly need help from anyone outside our very experienced and specialized group” syndrome.

5. Lack of trust: the “why should I take the risk to help whom I compete with, I wouldn’t get the recognition for it anyway” syndrome.

6. Internal politics: “Knowledge is Power so I retain it” syndrome.

7. Lack of Awareness of internal knowledge: The “I do not expect anyone in the company to have the experience/skills I need” syndrome.

8. Lack of Availability of internal knowledge: The “others probably could benefit from my experience but I’m too busy to check, let alone actually help” syndrome.

9. Too much Pride: The now too famous "not invented here" syndrome.

10. The confidentiality issue: The “we fear that some vital competitive knowledge can get into the wrong hands, so the least we share it, the smaller the risk” syndrome.

11. Job Description framing: The "No-one's paying us to have a wider vision" syndrome.

12. Groupthink effect: The "We'll define our stakeholders as the people we already know" syndrome.

13. Only money talks: The "those so-called stakeholders aren't actually funding anything directly, so they're not real customers" syndrome.

14. Perfectionism resulting from fear of being wrong: the "I won't share until I'm certain it's perfect" syndrome.

15. Modesty resulting from lack of encouragement: the "who am I to teach others, of course they know" syndrome.

16. Top-executives misunderstanding KM challenges: The "this knowledge sharing sounds great! Can you order everyone to do it tomorrow please?" syndrome.

17. Dominance of explicit over tacit knowledge sharing: The "we only truly value what is written down and validated" syndrome.

18. Lack of social networks: The "only the networks which are supporting business processes are important and encouraged" syndrome.

19. Lack of knowledge management strategy and sharing initiatives into the company’s goals and strategic approach: The "Intellectual Property is the only Intellectual Capital that is worth managing strategically" syndrome.

20. Intense internal competitiveness within business units, functional areas, and subsidiaries:
The "we only share knowledge within our team since everyone else is potential competition" syndrome.

You can test your organization against these 20 cultural traits. The more of them fits your workplace, the more of a challenge you will have to promote knowledge sharing. Some are more difficult to deal with such as internal politics, but I would conjecture that you will need to address all the relevant traits at some point in the process. They all have their importance and only one of them - deep rooted in the organizational culture - can jeopardize leveraging knowledge efforts.

The latest trends for Intranet development

2009-12-02T15:56:00.001Z

This IBF blog post from Paul Miller about the coming of “Intranet 3.0” gives 3 very good examples of large corporate intranets pushing the boundaries of internal communication and collaboration.

Although I am not a fan of these meaningless numeric names such as Web 2.0 or Enterprise 2.0 (I’ve even seen Web 1.5 being used!) the eight Intranet 3.0 trends listed can - when combined - represent no less than a workplace revolution.

The 3 organizations given as examples are Sun, IBM and Nissan. The common theme I picked up between these cases is the strategic importance given to embedding the Intranet in business operations. This quote from Ethan McCarty (IBM) is spot on:

“The intranet is so deeply woven into daily life at IBM, it's part of every employee's day to use it,[..] You take a very mundane task and turn it into a social activity. Collaboration isn't separate from work. “

I particularly like this quote because the same thing should be said of Knowledge Management as a whole. KM initiatives are successful in the long term if they enable knowledge sharing processes that cannot be dissociated from operational activities. So, in other words, in such context, if you don’t share knowledge and collaborate intensively, you’re simply not doing your job. However, this requires a corporate culture not only conducive to knowledge sharing, but encouraging it.

Leverage the knowledge in your company by first transforming it into a process based organization

2009-11-22T16:52:00.005Z

I am increasingly a supporter of the principle that it is more efficient and increases the chances of success to leverage organisational knowledge with a stealth approach, meaning not in a direct open way, but indirectly and without advertising it as THE objective. The less a company’s culture is conducive to knowledge sharing (see my list of corporate culture traits not conducive to knowledge sharing) the more this principle should apply.

In the majority of organizations today, performance is measured and rewarded functionally usually at department levels. This generates departmental silos where knowledge is at best hoarded for internal consumption.

But when performance is measured only through formally defined intra-departmental processes, managers and staff will naturally focus on supporting the processes as efficiently and effectively as possible. For each cross-company process, this will mean sharing all the relevant knowledge between all the individuals/teams/departments directly involved in the process and therefore responsible for part(s) of it. A process-based organization naturally breaks down departmental silos: if a process fails, all participants fail.

So, in other words, reingeneering an Organization’s operations and structure around clearly defined cross-company business processes is an effective indirect way to foster value adding knowledge sharing.

I will not doubt write more on this subject soon.

The History of Maths and Knowledge Sharing

2009-08-02T10:35:00.002+01:00

Yesterday, I watched a TV program produced by the Open University on the history of Maths.
It started in China where Mathematics as a discipline really started. A book was written in about 200BC explaining among other things how to resolve equations.
Then it moved on to India a few centuries AD where truly important advances were made such as the 9 Indoo numbers (ancestors to the Arabic numbers we use today), the creation of the number 'zero' and the first method for resolving complex equations to the power of 3 as well as the first method for an approximation of the value of Pi. Then came the Middle East and the Arabic countries where further discoveries were made in the Middle Ages.
The point in common with most of these advances in Mathematics are that they were all made in the East well before they were either "rediscovered" or applied in the West from only about the 15th Century.

And this is when it struck me! The lack of communication between these Eastern civilizations and the Western World prevented a valuable knowledge sharing that would have enabled a much faster worldwide scientific progress.

What has enabled an exponential scientific and technological progress in the last 3 or 4 centuries is the increasing ease to share knowledge around the World. The Internet being the last of these inventions to contribute immensely to this. But then, if it is so obvious that sharing knowledge between distant civilizations, cultures or communities generates creativity, discoveries and innovation; why is it so difficult for most modern companies to recognize the value of fostering internal (and external) knowledge sharing between all employees and stakeholders?

Is sharing knowledge really desirable (question asked on Linkedin)

2009-06-01T21:35:00.002+01:00

I recently asked on Linkedin my question comparing two extreme organisations in terms of knowledge sharing processes posted here on 26/04/09 (see all the 14 responses here). More respondents chose company B model (with knowledge sharing). A significant number went for the “it depends” option and a still significant number chose company A model (no knowledge sharing). I do not of course consider this as a quantitative survey but I would like to think that the respondents are a meaningful qualitative representation of managers thanks to the very nature of the medium used: the Linkedin professional networking site. In any case, I was not attempting to obtain a “true” representation of manager’s opinion but more an idea of the proportion choosing model A and what their arguments would be.

For all intent and purposes, I view the company A and “it depends” answers in the same larger group of managers that do not consider company B as the best choice all the time.

Arguments given for company A by the ones who chose this model are:

1. It is more organized for achieving the company’s goals by having people more focused on their department’s/team’s objectives.

2. Sharing of information between teams/departments strictly limited to what is needed for the operational work flow/supply chain, or in other words, “share [the information] needed to do the job – no more no less”.

3. It prevents information overload.

Arguments given for company A by the ones who opted for a split decision are:

4. Does well in a “best cost approach” (as opposed to “best product/solution approach”).

5. Suppose their offering is functional—it satisfies basic, unchanging needs and has a long life cycle, low margins, and stable demand. (Think paper towels or light bulbs.) In this case, you need an efficient supply chain—which minimizes production, transportation, and storage costs. So model A is better suited for “labour (Production and Manufacturing)” Industries, where employees are not expected to rely much on their thinking abilities.

6. It is a question of size and this model does well in large companies.

Let me now analyse each of these arguments:

1. Why would a model B company be necessarily better organised for achieving the company’s goals? Why is it that the vision of letting people freely share knowledge is often assumed to generate mess?With adapted formal processes in place, you can very effectively and efficiently enable knowledge sharing flows in an organised way, all in line with the strategic goals. Google is a perfect example of this as it has a second to none knowledge sharing culture and is definitely not a “chaotic organisation”.

2. This argument is from another age I believe. It describes the organisational models of the industrial age. We have moved on to a knowledge economy when intangible assets must increasingly be considered to accurately value a company. Managers can no longer dictate over time what information – and even less knowledge – is strictly needed for each operational role to be competitively efficient and effective. In a model A company, by the time managers adjust the information flows in reaction to the market, it is often too late and damage is done with the competition already ahead. To be ahead of the competition, you need to be proactive and therefore enable – at the level of the individual - fluid and adaptive knowledge flows internally as well as with with external stakeholders.

3. When I speak of knowledge in model B, I mean "knowledge", not information. Therefore, the argument of information overload does not hold water. Employees will only seek/share the knowledge they ask for/consider valuable. This is not about having full access to an encyclopedia of (mostly irrelevant) information. Even employees in a model A company can have access to it via the internet for instance!

4. A company with a “best cost” strategy such as Easyjet, the successful low-cost airline, does not imply a top-down structure with isolated teams and departments asked to only do their predefined job. Easyjet incidentally promotes a knowledge-sharing and learning culture where it is assumed that every tasks can always be improved by each individual for the benefit of all his/her colleagues (and ultimately the benefit of the company) therefore improving efficiency and reducing costs further. See below what Easyjet expects of its employees (from Easyjet recruitment website ):

Pushing yourself to constantly develop and learn from every opportunity
Sharing knowledge and ideas with colleagues
Seeking feedback
Displaying a positive attitude that contributes to an enjoyable working environment
Communicating your intentions clearly and positively

5. I can agree in principle that in a labour intensive industry (as opposed to a knowledge-based industry) employees are less expected to think and hold valuable knowledge for the company. But this does not mean they never do! If a factory worker works out a better way to use a machine for his/her repetitive tasks, wouldn’t it be valuable to the company that this knowledge be shared with all the employees using the same machine, even if their factory is on the other side of the World?

6. My example of Google earlier already negates the argument that a large company operates better in model A. And there are many more successful large companies with a knowledge sharing culture such as Toyota, BHP Billiton and 3M. In fact, I would argue that the bigger the company (in number of employees) the more valuable knowledge it potentially holds so the more benefits it can obtain by leveraging it.

Having said all that, we are still left with the disconcerting fact that the majority of companies today still gravitate closer to model A than model B. If leveraging organisational knowledge makes so much business sense, then why isn’t it already widespread and becoming the norm?

I think the answer to this question lies more with organisational culture stagnation than with operational or strategic considerations. For most companies senior management, enabling knowledge sharing or not is not about success but more about losing management control and power. In my 2 blog posts on “organizational cultures not conducive to effective leveraging of knowledge” (first here then here ) I listed 20 common cultural traits inhibiting knowledge sharing. You should find a lot of these traits fitting well with any companies closer to model A you are familiar with. Conversely, anyone familiar with companies more in line with model B should not recognise these traits as typical of their culture.

So now, are these “model A” organisational cultures to last? For a while yes but some factors will (hopefully) slowly do away with them such as:

Generation Y taking over the board room. This is about the necessary top-down leadership to instigate a knowledge-sharing culture, probably lead by the generation of managers who grew up with the Internet.
Information Systems increasingly integrated and pervasive that facilitate (and reduce transaction costs of) information access and expertise localization.
An increasingly mainstream acknowledgement of the direct relationships between success and knowledge-focused organisational cultures.
Social media spreading inside the company. This is the bottom-up pressure for enabling a similar level of knowledge sharing at the workplace that people have at home.
Or more simply, going out of business as a result of being out of touch with the Knowledge Economy.

Social Media: overhyped fad or essential tool?

2009-05-22T11:53:00.003+01:00

Attended an MBA Association event last night:
Social networking for business – overhyped fad or essential tool? Speakers: Mireia Fontbernat, Paul O’Nolan & Paul TannerLocation: Strand Palace Hotel

In a few words, the speakers confirmed what I already knew or suspected: No one has a clue where online social media is really taking us (and these 3 speakers were no exception). It is not about having a crystal ball but about having a clear understanding of the effects that these social tools have on our societies, and what their generic objectives are.

When the telephone was starting to spread around the world many years ago, one could understand the effect on the society (connect everyone synchronously and speed-up information flows between individuals) and foresee an end-game (everyone being able to call directly anyone else from anywhere). You can't do that for social media today.Maybe it's because it is too soon after the first of these tools were created. But that is my point actually, we need more time to make real sense of it all. In the meantime, if it is important to embrace this online social world, it is no less important to be wary of potential pitfalls. For instance, the more you interact with this world, the more it knows about you. So, for a start, what you need to really keep private, don't put it online (but these pitfalls were not really addressed at the event yesterday either, it was more about what you can effectively do today for your business or for yourself).

I think that what can be said today of the effect (benefit!) of social media is that it transfers power of influence to the individuals, and by extension to communities of individuals.Each of us has potentially the power to influence comparable to politicians or journalists. Recently, Ashton Kutcher (Demi Moore's husband) managed to reach 1 million twitter followers before the News network CNN. I am certainly influencing many more people with this blog than through my physical networking.

What does this mean to businesses? Well, it can be summarized like this: Your company can choose not to know about its customers through social media, but your customers will certainly learn a lot about you online and it won't always be nice stuff! And that, they did illustrate it well at the event last night.

So embrace online social media yes, but not in haste and choose the right tools for the intended audience and purpose.

The Cultural challenge (for outsourcing companies)

2009-05-08T17:31:00.002+01:00

After their successes with outsourcing services, Indian IT Services firms are growing their consulting business. In Europe, and in particular mainland western countries like Germany and France, one of their key challenges is to convince European executives that they have acquired internally enough “local” culture to provide adapted services. This is only a matter of time and the first Indian firms to achieve this will build a strong competitive advantage.

Andreas Floth from PA Consulting Group, the international management, systems and technology consultancy, said back in 2004: “The growth of ‘nearshoring’ in Central and Eastern Europe offers exciting opportunities in Western Europe for provision of IT development and business process outsourcing. Their standard of IT literacy and expertise is very high, and both supply and demand of IT knowledge in the acceding countries will increase steadily. ‘Near-shore’ outsourcing also appeals to cautious CIOs who want to maintain control over IT assets.
However, service providers must improve significantly to meet expectations.” Three years later, we can say that the Indian consulting firms have taken on board this competition threat. In fact, some of them have started recruiting and opening up support and technical sites in Eastern Europe, bringing with them their technical skills and experience. However, success is not just about technologies and how to implement them. It is also about a deep understanding of the customers and their business, social and political environment.

According to Gartner Indian offshore service providers face three big challenges if they hope to be seen as equals with traditional European providers (all consulting firms with a long history in Europe):

1. “European Providers Enjoy Entrenched Mind Share
Traditional European local or multinational providers enjoy greater mind share among European buyers. Their long-term presence and investments have demonstrated a commitment to each of the European countries and have underlined a European strategy. Until recently, with the exception of the U.K., many European companies believed the Indian providers had an opportunistic approach to Europe. By increasing local hires, the Indian companies will take the first step on a long, slow path toward gaining European buyers' trust and confidence. A growing number of providers are starting to demonstrate capabilities that will help organizations look beyond cost savings to achieve other benefits, including access to scarce skills, resource agility, productivity gains, process improvements or innovation.

2. European Companies Are Reluctant to Publicly Acknowledge Offshoring
Continental European buyers' reluctance to acknowledge their use of offshore services does not help providers that want to leverage their success to win more deals, particularly when they are trying to gain traction in certain industries or countries. This silence about the use of offshore services also disguises the extent to which companies use offshore resources. Some continental European companies have signed deals with traditional service providers for offshore services, so that it is not obvious to the market that they are moving work overseas. Many traditional service providers have decreased their European operations in favor of increased offshore delivery capability. Some offshore providers, therefore, are justified in claiming that they are the local employers of the future as they scale up their local network of skills.

3. A Large Labor Pool Can Become Unwieldy
Indian and traditional providers are building scale offshore, in India and elsewhere. For the Indian providers to continue their strong growth, they must move away from labor-intensive methods of responding to strong demand. Effective operations in the future must also be able to offer process automation, including repeatable solutions and utility delivery models, or these providers risk building up an unsustainable and unwieldy resource pool.”

The second and third challenges are more concerning the outsourcing activities (not the topic of this article but nevertheless important). The first challenge about mind share however is also valid for the consulting business, in fact even more so I would say. In the same article, “Gartner advises Indian offshore service providers to establish local (onshore and/or nearshore) delivery capabilities, not just sales offices. This is because buyers will seek consulting and delivery capabilities that understand their local markets and business environments, in addition to being able to address language and cultural issues. Indian offshore service providers must plan early to adapt their delivery model, taking into account nuances like automation of processes, more repeatable services and solutions, utility delivery approaches and true innovation.”

Unless you don’t mind taking 10+ years to get there, this local delivery capability means local recruitment among consultants and professionals with a significant European professional and cultural experience. These “locals” will help for:

Winning contracts. European executives need be comforted by the client-facing sales team that their consulting firm has the competences to deeply understand the given business. Having around the table a team of Indians looking and sounding like they’ve just landed from Mumbai might not do the trick.

Delivering successful projects with greater chances to exceed customer expectations. With top class knowledge of best practices and technical skills, a team of Indian consultants would probably manage to meet most project objectives (and usually with very competitive prices). However, in order to go beyond these objectives, the team would benefit having at least one member with local and specific knowledge of the customer’s business, social and cultural context.

It is important to realize that it is not only about the culture of given countries, it is ideally also about a specific market and/or organizational culture in line with the consulting firm’s strategy. If for example a consulting firm intends to provide services to the large food retailers (like Carrefour, Tesco and Asda) it needs to recruit professionals and consultants with relevant retail experience (i.e. worked for one of these retailers). Managing a chain of supermarkets in Europe carries specific cultural traits that would not be immediately assimilated by an Indian consultant with an Asiatic food retailing experience.

I will illustrate the importance of cultural differences with the reverse example of one of these European retailers (Carrefour) that had to adapt to the Chinese market for a rather odd but nonetheless important cultural habit: the Chinese grocery shopper likes to touch and smell fresh food before buying, and not only fruits and vegetables as in most European countries, but also rice, fish and meat! It is extremely unhygienic but Carrefour had to adapt their shop design and packaging practices or not sell these products. This is of course an extreme and easily identifiable market specificity but more insidious differences could have no less significant impact on a consulting project.

The knowledge challenge (for outsourcing companies)

2009-05-07T17:33:00.002+01:00

[Below is an article I wrote in Nov 07 for a now defunct Indian website. I stand by it even more today].

For Indian outsourcing providers, their business is evolving towards securing partnerships for innovation with their customers. It is therefore no longer only about cost-savings and taking on non-core activities. Now here is a challenge for them: How to go about obtaining enough specific internal knowledge from their customers in order to produce relevant value-adding innovation?

The reason why this is a challenge is that most organizations today still fail - or don’t even attempt - to build a knowledge based culture where knowledge sharing between all their employees is the norm. If a customer’s key representatives only share knowledge and experience with their colleagues when they have to, why would they share more freely with external consultants?

In my experience, consultants usually obtain more information on a specific issue than internal managers, but that is usually due to their – justified or not - “impartial” and “more objective” status. It is also because employees are told to assist the consultant in any way they can because… hem… they are not cheap. But this actually only reinforce my point: For a true value-adding cooperation between an outsourcing firm and a customer organization, you cannot rely on people sharing knowledge only because they are told to do so, you need much more willing and systematic involvements.

To truly understand the issue, one must realise that the type of partnership that we are talking about here is of a new breed. It is not the classic consulting time-bound project with consultants walking in, gathering information, analysing it, developing then submitting a solution, and finally walking out. What is suggested here is a long-term relationship requiring systematic access to relevant information and sharing of knowledge and experience between the customer and the service provider.

Innovation does not happen in a vacuum but is very context-dependant. Furthermore, innovation is nearly always the product of collaboration between individuals/teams/companies.

Ok, so what is my point then? I do not claim to know all the consequences of this problem (I count on you all reading this to help out). I would only suggest this: Outsourcing firms should steam ahead offering new collaborative services to their most “knowledge focused” customers. With them, there should be no problem in co-generating innovation and value.
However, with the other customers still stuck in, pre-Knowledge economy, pre-Web 2.0 era with Industrial Age management methods, my advice is either stay clear of making too many promises, or alternatively first offer to assist them in transforming their organizational culture and foster knowledge-sharing.

To support the second option, I will quote a report on the recent KM India 2007 Summit :
<<
Comparing the current Knowledge Management (KM) movement with the Quality movement of [the] 80s, noted IT entrepreneur and Chairman & Managing Director of Mindtree Consulting Mr Ashok Soota said,
"Knowledge movement is the next important movement. It is like the Quality movement of past. CII and industry will promote this like we did with quality movement." The Summit is being held in New Delhi from Nov 14-16. Highlighting the importance of KM in today's corporate world, quoting management guru Peter Drucker, Mr Soota said, "Today there are no poor countries, only ignorant countries! The same is true of companies." >>

Innovation is a priority, so why not KM?

2009-04-28T18:32:00.003+01:00

A recent Boston Consulting Group report shows that 64% of companies consider innovation as one of their top 3 priorities. This is less than the 72% in 2006 but still high in the current difficult economy. That is good and understandable but then why is Knowledge Management not a priority as well as a result? You cannot foster innovation throughout a company wihout effective and efficient knowledge sharing processes.

Apple, Google and Toyota took the top 3 spots of the most innovative companies. Unsurprisingly, these 3 are regularly at the top of the global Most Admired Knowledge Enterprises (MAKE). In the 2008 ranking, they were in the 7th, 2nd and 4th place respectively.
In fact, 9 of the 20 global MAKE companies last year are among the BCG top 50 innovative companies including 5 of the top 6 !

These organisations have understood that innovation does not only sit in the R&D labs, it is to be fostered everywhere. Innovation implies effective collaboration between individuals, teams, deparments and companies, and effective collaboration implies in turn effective knowledge sharing between all these actors.

All these companies above invest heavily in knowledge management and would typically have managers with formal KM responsibilities. But then why is it that the companies with such formal and significant KM are still such a minority? What will it take for leaders to realise en masse the importance of KM?

Is sharing knowledge really desirable in a business?

2009-04-26T22:17:00.003+01:00

A. Imagine a company where no knowledge is shared. Only information is passed on between employees within pre-defined operational processes. Each employee exchange information only to their immediate colleagues, either within their team/department or with the colleagues in the next/precedent levels in the operational chain.

B. Imagine a company where all knowledge (tacit or explicit) is shared. All employees share their individual and collective (team/department) knowledge with every one else within the company. Each employee is free to share his/her knowledge with anyone else and to ask anyone for his/her knowledge on any subject (of a professional and non-confidential nature).

My question is simple: which of these two extremes is likely to generate the most successful business, assuming they would be both in the same market(s) and every other parameters equal (eg. number of employees, age) ?

I will expand on this question later on but for now, let me just say that for anyone answering B, please give me strong arguments because the majority of businesses today are still closer to extreme A.

Getting the right information to your retail customers at the right time, or how to make them loyal to your brand

2009-03-29T22:20:00.004+01:00

In these very challenging economical times, retaining your customers is a must to survive now and thrive when things improve. For your customers to repetitively shop in your stores (on the high street or online) means for them one or both of the following conditions:

· It is to them the most practical or ‘lack of choice’ (ex.: “I shop at your supermarket because it is the closest to my home”).
· It is the brand that best fits their needs and/or wants at that moment in time.

You could of course consider the first group of customers as a bonus but they should be nurtured too as the practical reason for their custom could disappear and them with it (like moving house). The key for making either type of customers (“for practicality” or “by choice”) stay with your brand long term, is increasingly to provide them with the right information at the right time and in the right place, and this through all the market channels you make available to them. For instance, when online, a customer is virtually always one-click away to choose a competitor. I am not referring here only to ecommerce situation but to any web browsing situation to obtain information about your brand/company, starting of course with your main informational website.

In retail, you not only need to be consistent between your various channels but you need to integrate them as well. So it is not just about consistency in products and pricing, but also for example about enabling a customer who purchased online to be able to collect and return in store if he/she wishes to. And this type of seamless (to the customer) integration is not just an information systems problem. For instance, the manager of the store where the products purchased online are collected, will not welcome the transaction if the sale isn’t allocated to his store some way or another! So if only your online store gets the sale, you will de facto create internal resistance and unnecessary competition that ultimately could affect the customer (a solution by the way here is to have the sale shared by both channels).

Providing customers with the right information at the right time and in the right place implies understanding their likes and dislikes, their needs and wants. In the luxury goods sector, this knowledge on customers has historically been obtained by the sales associate on the shop floor during the process of a sale. When you buy a £,000+ product or service, you have time to chat about yourself and the reasons for your purchase (and you often want to) but when you are buying a pack of beer, a pair of socks or a bottle of shampoo, you usually don’t want to spend more time than necessary. Well, this is changing and primarily thanks to ecommerce. When you want to buy a shampoo or a pack of beer online, you must first register your name and contact details at the very least, so you have provided the private information that the retailer would not have obtained on the high street – except if you had used a “loyalty” card. So retailers can track customer behaviour online but often fail to do so on the high street which makes it difficult to leverage the integration of the different channels to market. Loyalty card schemes have been thought of the solution but too often fail to deliver the desired outcome because:

- Too many customers don’t bother signing up to the scheme (for various reasons but often simply because they don’t consider the associated discounts significant enough).
- A majority of customers will view it only as a discount scheme (“when I shop here, I might as well use the card and get the discount points as a bonus”) but their repeat visits do not depend on it.
- Most of the competition have a similar scheme so it does not constitute a significant USP (large number of customers end up with all your competitors’ loyalty card in their wallet).

A loyalty scheme needs to be about loyalty, not only about discounted repeat purchases. So this takes us back to the subject of this post: “true” loyalty can be achieved when the customer has access to and is given the right information at the right time about your product and services. “Right” information means as individualized as possible. A customer is really only interested in the products and services that concerns him/her. So for ex, a customer who never drinks alcohol wouldn’t care less about a promotion on wines. And it is not as simple as thinking that such a promotion should target only customers with a history of wine purchases. Our non-drinker customer could easily have once bought a bottle as a one-off gift for a friend.

My point here is that the goal for retailers should be to have reliable and relevant knowledge of their customers in order to provide them in return with the right information at the right time.
This effective knowledge of your customers will of course rely on sales history based information obtained with traditional “loyalty schemes”. But crucially, to obtain a true USP with this knowledge, a retailer will have to find and master other sources of information. Social networks are one such source, with examples being online communities. Examples of retail focused websites taking full advantage of this are the customer reviews based sites like www.toptable.com or www.yelp.com. Retailers need to engage with these indirect sources of customer information and use them as models for implementing social networking solutions directly engaging with their customers (or potential customers).

I will not list here all the possibilities (and I don’t know them all anyway) for retailers to improve their deliveries of effective information to their customers. Obviously, many great ideas are still to come. What is certain is that the retailers that will consider this challenge strategically and be among the first to surpass their customers’ expectations, will lead the pack when the economy recovers.

A Prediction Market Cluster conference on Collective Wisdom

2009-01-12T22:49:00.004Z

Well, following on from my last post about Collective Wisdom, it seems that Surowiecki started something big with his book!

I have received an invite to a conference in San Francisco on Collective Intelligence.

Unfortunately, I won't make it (a bit too far from London!).

It seems that this subject is gaining a lot of interest and success stories.

I like the diagram above that is given on this conference web page. It's a good and simple summary of Surowiecki's key principles on collective wisdom.

If anyone reading this attends this conference, please contact me to let me know how it went.

About The Wisdom of Crowds

2008-12-08T10:08:00.000Z

In his book “The Wisdom of Crowds – Why the many are smarter than the few”, James Surowiecki makes - indirectly but nonetheless powerfully - a very good case for Knowledge Management or the leverage of individual and collective knowledge.

Simply put this way, that the many are smarter than the few is hardly a contentious statement. After all, a croud of say 1000 individuals should be smarter than only 500 of this same croud most of the times. You have more minds available to solve a problem/find an answer. However, what Surowiecki means is that a croud of 1000 can be – with the right conditions – much smarter than the sum of its parts even when it acts/decides in a completely uncoordinated way (meaning each individual acts/decides in isolation from the others). In fact, such a group can be (and Surowiecki gives plenty of examples) smarter than the even best experts in a particular field!

The three conditions for this group wisdom to materialise according to Surowiecki, are that it must be diverse, independent and decentralized.

On diversity, Surowiecki writes (chapter 2, part III):
<<The fact that cognitive diversity matters does not mean that if you assemble a group of diverse but thoroughly uninformed people, their collective wisdom will be smarter than an expert’s. But if you can assemble a diverse group of people who possess varying degrees of knowledge and insight, you’re better off entrusting it with major decisions rather than leaving them in the hands of one or two people, no matter how smart those people are.>>This can be hard to believe but Surowiecki then makes the case for this point very well and I cannot find any reason to disagree with him.

On independence, he writes (chapter 3, part I):
<< First, [independence] keeps the mistakes that people make from becoming correlated.[..] One of the quickest way to make people’s judgments systematically biased is to make them dependent on each other for information. Second independent individuals are more likely to have new information rather than the same old data everyone is already familiar with. The smartest groups , then, are made up of people with diverse perspectives who are able to stay independent of each other. >>
I would think that this condition is in theory much less contentious than the first one on diversity. However, the problem with true independence is that in practice, it is rather difficult to obtain. Often, decisions in a croud are made sequentially with each individual influenced by his/her predecessors.Therefore, Surowiecki advises that <<If you want to improve an organization’s or an economy’s decision making, one of the best things you can do is make sure, as much as possible, that decisions are made simultaneously (or close to it) rather than one after the other.>>

On decentraization, he writes (chapter 4, part II):
<< [..] if you set a croud of self-interested, independent people to work in a decentralized way on the same problem, instead of trying to direct their efforts from the top down, their collective solution is likely to be better than any other solution you can come up with. [..] Decentralization’s great strength is that it encourages independence and specialization on the one hand while still allowing people to coordinate their activities and solve difficult problems on the other.>>
However, Surowiecki then cautions that : << decentralization’s great weakness is that there’s no guarantee that valuable information which is uncovered in one part of the system will find its way through the rest of the system.>> He then asserts that for a crowd of any kinds to allow << individuals to specialize and to acquire local knowledge [..] while also being able to aggregate that local knowledge and private information into a collective whole, [..] [it] needs to find the right balance between the two imperatives: making individual knowledge globally and collectively useful (as we know it can be), while still allowing it to remain resolutely specific and local. >>

Well, well, isn’t this where/when Knowledge Management should come in? In fact, for all intent and purposes, this is a definition of KM I am satisfied to work with in an organizational setting: any intentional and managed changes or activities with a conscious objective to facilitate/enable what is highlighted in blue above. But it then highlights a fundamental reason for organizational KM to have so often failed to deliver: the lack of management recognition that collective knowledge in practice is indeed always valuable, with the potential to be very often correct and effective. Leveraging knowledge is then not just about realizing (and doing something about it) that each employee’s knowledge is valuable (and that’s already hard enough for most senior managements) but that the collective knowledge of the whole or groups of employees is even more valuable.

I think that a cultural shift is needed here for this realisation to become the norm rather than the exception. This shift has already started with the ubiquitous nature and global reach of the World Wide Web enabling huge crowds to influence decisions directly or indirectly (eg. Obama’s election). This shift now needs to enter the board rooms en masse. According to Malcolm Gladwell, “the tipping point” (see his book with this title) should be reached when between 10 and 15% of board rooms will have formally acknowledged the value and power of individual and collective knowledge. I can safely predict this will happen even if I cannot say when.

Heathrow T5 opening fiasco continues to haunt travellers minds!

2008-08-31T16:14:00.002+01:00

Back in April, I wrote about Heathrow irport Terminal 5 opening fiasco.
I explained why I believe that on the part of British Airways, it was mostly due to a lack of training and lack of user acceptance testing of all the new systems and procedures.
I also deduced from this that BA probably had an authoritative management style, a very hierarchical structure, and a corporate culture that didn't allow individuals at the bottom of the pyramid to voice concerns and constructive criticism in an effective manner.

Later on, I watched amazed on BBC TV news , BA's CEO Willie Walsh acknowledging that his company's management did anticipate a difficult T5 opening, but that it was decided that the costs of delaying it would be greater than the potential costs of a failed opening!

The costs directly attributed to the fiasco was estimated at £16m, already a big sum. However, I wonder if Mr Walsh and his team did account for this: Virgin sales are up thanks to T5 troubles

Insightful Knowledge

2008-08-24T19:42:00.000+01:00

I am currently reading the very interesting marketing book "Creating Market Insight. How firm create value from market understanding", written by Dr Brian Smith and Dr Paul Raspin (Wiley edition).

I will surely write a few posts about this book but I'll start here with their definition of an insight in a business context:

For knowledge to be considered insight, it must pass what the authors call the VRIO test. Knowledge must be
<< · "Valuable": Does this knowledge enable the firm to respond to environmental threats and opportunities?
· "Rare”: Is this knowledge currently held only by the organisation and not by its competitors?
· Not easily Imitable: Is it costly or difficult for other organisations to obtain or develop this knowledge?
· Organisationally aligned: Is the firm organised, or can it be organised, to exploit this knowledge?
>>
The authors do not mean that non-insight knowledge isn’t useful of course. But they attempt to differentiate knowledge that is merely useful from knowledge that is insightful.

I think it is an interesting framework but I am not convinced about their definition of valuable knowledge:
“Knowledge is valuable if it enables us to change something, rather than maintain things, and that change is valuable to either the customer or to the firm.”

Although the authors approach this from a marketing point of view, I really struggle to agree with the notion that valuable knowledge must imply change. The authors themselves acknowledge that “the value test is a contentious and difficult one to apply t to a piece of knowledge.”
One problem with this view is that it risks to prioritize in the mind of managers all the ideas and projects that imply change. Ideas and projects to improve existing activities would not be given enough attention and resources. But often it is such improvement that sparks the creation of new knowledge, that in turn will lead to a “valuable” change. In other words, a change providing competitive advantage does happen in an improvements-rich context that cannot be completely dissociated from the change. So without a good dose of “useful” knowledge, the “valuable” knowledge wouldn’t be created at all, let alone lead to an insightful change.

Furthermore, stating that the change must be valuable to either the customer or to the firm does not help at all to define valuable knowledge, since any piece of knowledge that isn’t meeting this characteristic cannot even be considered useful to the firm!

I think the problem with this definition of insightful knowledge is the use of the word “valuable”. I cannot yet put my finger on it but there should be another way to define what the authors had in mind without the too simple differentiation through subjective value. When I think of something, I’ll post it here.

Knowledge Management in ITIL v3

2008-07-28T18:00:00.000+01:00

Read this very clear and insightful white paper from Peter Dorfman (dated May 2007):http://www.thinkhdi.com/hdi2008/files/ITIL3.pdf

I agree with nearly all of it. Let me highlight one of Peter's concluding point:

<<For end users, ITIL 3 is an opportunity to get KM onto executive radar screens, maybe for the first time.Managers who have tried to promote KM adoption may see this as a golden moment to advance a personal objective, and they may be right.>>

This is absolutely correct but based on my experience, I would not advise IT Managers to seek the implementation of a KM specific software solution that would somehow sit on top of or alongside the Service Desk Management system. You will not succeed in making 1st and 2nd line technicians switch to a different tool to record or search for valuable knowledge.KM must be integrated with all the other processes (Incident/Request/Problem Mngt, etc...).To succeed, it must become part of the technician's normal activities to resolve issues or satisfy requests. As always, KM is first about people, culture and processes well before being about tools! And ITIL v3 actually does emphasize on this, and this is maybe one reason why it does not litteraly consider KM as a separate support process.

5 real life examples to make the case for KM in a sales environment

2008-06-23T18:12:00.001+01:00

”[..] an organization is nothing more than the collective capacity of its people to create value” (Louis V. Gerstner, Jr., former CEO of IBM)

Consider the following five simple scenarios based on real situations I have witnessed during my time in the Richemont Group. I must stress that I expect these to be relevant today to a majority of retail Organizations, and not only in the luxury sector:

1. “Reinventing the wheel.”

The Logistics Manager of a regional distribution centre believes that he could greatly improve his team’s efficiency during inventories with the use of about 5 barcode readers. He contacts the IT department for advice since the idea will be to interface with the main IT system.

When the stock controller is consulted, she decides that barcode readers would be too expensive if they were to be used also for boutique inventories (you would need at least 20 readers). Since laptop PCs are used in boutiques, it is decided that they would also be used for the distribution centre, against its manager’s preference. It then turns out that if laptops are adapted to boutique stocktaking, they are not practical in a warehouse: too heavy to carry around the aisles and with much less autonomy on battery.

The Logistics Manager asks the IT Manager if he could find out from his counterparts what has been implemented in other regions. Logistics Managers have very little contact with one another so rarely share ideas and experiences. The IT Manager finds out that in another region, they did implement a cost-effective barcode reader solution and have even used it in some boutiques. A corporate discount is maybe even possible for the readers.

By reinventing the wheel we might improve it, but is it worth the costs when all that is needed is a regular wheel?

2. “Knowledge is Power so retain it.”

A wealthy American businessman enters a jewellery boutique in Tokyo. He intends to offer a present to his wife for their wedding anniversary in 2 weeks. He happens to be a regular customer at the 5th Avenue boutique in New York and does tell the Japanese sales executive Yukino of this fact. He is presented a selection of items but cannot decide, and then remembers that he had bought a bracelet for his wife two years ago.

“My wife loves this bracelet and it would be great for her to have a matching necklace”.
“Yes, sir, which bracelet was it?” Yukino ask.
“Oh, unfortunately I cannot remember its name. Could you find out for me? I bought it in New York”.
“I’m afraid I cannot do this. Would you remember the type of bracelet?”
“Are you telling me that you cannot check on your system?”
“Yes sir, we only have access to sales made in Japan”.
“This is not very useful is it? Could you call the 5th Avenue showroom then?”
“Well yes sir, I could try but with the time-difference, we’ll have to wait for this evening. Would you come back tomorrow then?”
“I’m not sure to have the time. I’ll call you tomorrow morning and if you have the details I’ll try to find a moment”.

In the evening Yukino calls the 5th Avenue showroom and ask for the manager who happens to be on a day off. The assistant-manager is busy with a customer and the sales-executive who picked up the phone does not believe to have the authority to give such confidential information. She takes the details and says that the assistant-manager will call back. Yukino waits until late after closure but no one calls back.
The next day, Yukino is lost in apologies for not obtaining the details of the bracelet.
“I am not impressed!” the American tells her. “I was really expecting such a prestigious Brand to provide better international services. I have to tell you, I feel like shopping around for something else as a result.”

Knowledge is power and even more now than ever. However, if organizational knowledge is retained and not shared, is the organization as a whole really gaining any lasting power from it?

3. “Everybody is replaceable.”

The Merchandising Supervisor of a regional distribution company is offered a new position in another country. Her effectiveness and efficiency as well as a great personality have won her a very good reputation with her peers within the Group. She has 10 years of experience in her current job and has progressively put in place a number of techniques and has mastered a couple of specific IT systems. Her manager is however soon concerned: how can she replace her supervisor without affecting the department’s performance?

The supervisor leaves in 3 months and her unique assistant only has 1year experience and has had very little involvement in about 50% of the supervisor’s activities. As for the Manager, she would also need to learn quite a lot from before the supervisor’s departure, and of course, she is already very busy with her own tasks. The Manager decides that the supervisor’s specific activities should be shared between herself and the assistant. The supervisor offers to spend long evenings to write up some step-by-step procedures. After a month, the Manager recruits someone who first needs to be trained on relatively simple but time-consuming tasks, in order to free up the assistant for spending time with the supervisor.

By the time the supervisor is on her last day, a significant amount of her knowledge has not been passed on or written down. The IT department is even called in to assess if they will be able to help with the usage of one specific piece of software. As a result, in the following months the Merchandising department struggles to maintain a satisfying level of productivity.

Everybody is replaceable, yes but at what costs?

4. “This is the way we do things here.”

Harrods, the London department store, is redeveloping its jewellery department this summer. A new boutique design of a jewellery Brand with a unit in this department is implemented for the occasion. Unlike before the late 90s, the local retail staffs as well as other departments (e.g. IT) are now involved in the process. However, at that stage it is about adapting the design to the local specific constraints and needs. There is a very tight schedule imposed by Harrods but the deadline is to be met.

Along the way, some design details are identified as being impractical. The functional aspect of the design seems to have been overlooked in favour of the aesthetic. For example, the IT equipment required in the retail area is not sufficiently integrated and facilitated. The beauty of a desk with no cable management will be spoiled by the laptop sitting on it and its power cable running from it. In peak times such as Christmas, the 5 or 6 sales executives (instead of 3 or 4) will each need quick access to a laptop but only 3 are catered for in the design. This will result in laptops being used on top of display cabinets so not really aesthetic but customers cannot wait for sales staff to queue up for a PC!

The same boutique design is to be used for many boutiques worldwide. Some of the very same functional flaws are reproduced again and again as no feedback from all the actors in the first project was formally obtained.

It is reasonable to assume that each department builds on past successes and is expert in its field. However, wouldn’t each project of a particular department benefit from the proactive input of all other stakeholders?

5. “Making mistakes is fine, this is how you learn.”

It is the first day of the month and as usual, each regional IT department completes and checks the End of Month process for the Group’s bespoke operational system. In Holland, the IT Manager identifies a problem: the new Group standard stock-valuing module recently implemented generates incorrect totals.
He investigates and soon finds the program at fault. While he has his programmer start to work out the exact problem, he sends an email to all his counterparts in the other regions using the same system, to warn them first and also ask if anyone had already detected this problem. He quickly gets an interest from most of them but more importantly receives a response from his Spanish counterpart telling him that they faced a similar issue the month before but thought it was specific to the Spanish version of the bespoke system. The good news is that they corrected the problem and documented it. The bad news, it was written in Spanish. What is then decided due to the urgency for the Deutsch End of Month procedure is for the Spanish and Deutsch programmers to work jointly by phone (in broken-English).

After several hours of collaboration, a Deutsch version of the solution is setup and tested and the End of Month procedure can be re-ran and completed 24hrs late. During that time, the system was not available to users for normal operations so the impact to the business was significant. We should note that when it first happened on the Spanish system 30 days earlier, their system was unavailable for 2 days.

Learning and innovation depends on a culture encouraging risk-taking and therefore making “mistakes”. However, shouldn’t this imply that we all collectively learn from these “mistakes” and avoid making them twice?

These situations all have in common a lack of knowledge sharing. They are all avoidable but the top-management first need to recognize the value of each individual’s knowledge and define and implement a strategy to leverage it.

Sustaining an Innovation Culture

2008-05-05T22:01:00.000+01:00

James Todhunter did it again. He wrote a very good post to list the following "5 pillars of sustainable innovation culture":

Executive Leadership
Skills Development
Innovation Infrastructure
Network for Innovation Mentoring & Facilitation
Internal Promotion

The first one is indeed the most important as it is a prerequisite to the other four.
I would add "Recognition & Reward for innovation". People need to be encouraged to innovate, so processes must be in place to formally and fairly recognize and reward the innovators, no matter how small or localized the innovation is (so long as it contributes positively to the organiozation's performance).

The British Airways T5 fiasco (update)

2008-04-06T17:21:00.001+01:00

See my previous post as I have added some info (and read the interesting comments as well).
.
.
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British Airways Heathrow Terminal 5 training fiasco

2008-04-04T17:10:00.002+01:00

You must all have read about this project “go live” failure. It was due to a combination of problems but the central one was a lack of training!

Amazing, it was a high profile and expensive project requiring state of the art technologies and methods in all areas (architecture, logistics, ICTs, security, construction, etc...) forgot to effectively deal with a key component: the people that will have to work in this new place!
The lack of training was not just for one group of people and not just for one system or activity, it was found wanting all over! From hundreds of staff not finding the staff car park entrance to check-in staff struggling with the IT system, from security personnel being taken through new procedures in the morning in front of passengers to crews and ground staff getting lost in the huge building, it was as if everyone was expected to learn by trial and error by themselves.

The costs to BA alone are estimated at £16m! With a fraction of this money, they could have financed the most advanced training program ever conceived, with virtual reality technologies for example (maybe with a T5 sim in Second Life).

Now, why is this related to Organizational Knowledge and Knowledge Management?
Formalized training is an essential building block for leveraging organizational knowledge.
What this fiasco tells me is that British Airways is very unlikely to have a knowledge sharing and cooperative culture. It is very likely to boast a command and control (and shut-up) culture. Not only the necessary knowledge transfer was not provided but many warning bells were not given the attention they deserved. Some middle managers and staff representatives did warn of the lack of training weeks before the opening. A large simulation was also apparently attempted with staff but it didn’t go as planned, and instead of scheduling another one, it was assumed to be sufficient. I will even go further in stating that such a training-related project failure would never happen with a knowledge-driven organization with a participative culture, simply because the human element would naturally be given the importance it requires.

UPDATE: I found this article from the Telegraph that informs us that the £16m loss might mean that the BA staff will not get a annual bonus in May! If this happens, that would be another indication of a command & control culture where management can make the worse mistake and have the employees pay for it.
The article also mentions the possible strike action by the pilots and that "they are also understood to be planning to write a letter to major shareholders next week calling for a change of management. The letter to Government ministers, the CBI and City institutions will accuse Walsh of arrogance, mismanagement and bringing the British Airways brand into disrepute." Oh dear, never mind a cultural issue in BA, it seems to suffer a heated and tensed atmosphere about to blow-up!

Anyone wanting more detailed information about what happened on the opening day, I recommend Michael Krigsman's article on ZD Net.

On having a “fostering innovation” culture

2008-03-25T22:22:00.000Z

As I have repeatedly written on this blog, continuous innovation requires access to knowledge. So an organizational culture conducive to knowledge sharing will foster innovation as a direct result.

James Todhunter (CIO of Invention Machine Corp.) wrote an article just published in CIO.com titled: “Fostering innovation culture in an unpredictable economy”. I am not sure what he meant by “unpredictable economy” as no economy has ever been predictable. “Knowledge economy” would be more relevant (and maybe what James had in mind) to relate to the current economy where knowledge (intellectual capital) is increasingly the most valuable asset for businesses, so the intangible taking over the tangible.

However, James Todhunter’s view that an innovative culture must be initiated and supported from the top of the organization is spot on:

<<[..] It starts at the top. The most common reason cited for why innovation workers feel their organizations fail to have an innovation culture is a perceived lack of management commitment. Organizational culture is created from the top down. In order to create a culture that supports repeatable innovation success, management has to make its commitment to innovation clear and unambiguous. [..]
It starts at the top. It really is that simple. Management has the power to set the tone and drive the culture. Managers who avoid taking responsibility for driving the innovation culture by using the “adoption must be a grass-roots thing” crutch, will always be met with failure and left wondering why they can’t achieve their repeatable innovation goals. Culture begins and ends at the top. To create a value-driving, sustainable innovation culture, you need only make it so.>>

I have constantly in this blog supported the idea that a sustainable fostering innovation culture (or knowledge sharing culture) can only be built with a honest top-down approach. In other words, it needs to be a strategic initiative. I know that many supporters of the social Enterprise 2.0 gaining momentum see it as an alternative to the top-down approach. They believe that if a large part of the people at the base of the organization start collaborating and sharing knowledge and adopting new (cheap or free) tools to do so, and if they increase productivity as a result; it will force the whole organization and its management to embrace these methods of working, this in turn forcing a culture change. Of course, people at the fringe of organizations will find benefits in adopting new collaborative technologies at a personal level first then within their team or department, as long as these technologies are answers to needs identified by them to do their work more efficiently and/or effectively. However, for these adoptions to force a company-wide culture change by themselves is not at all a given outcome. This might happen in some contexts but probably only in organizations where the current culture only needed a spark to turn into a knowledge sharing culture. In the majority of organizations where the culture is predominantly of a command and control type, matching my list of 20 syndromes I challenge the bottom-up approach to succeed on its own! Anyone aware of such a successful cultural change, please speak up.

What has happened in numerous occasions and will continue to happen, is for organizational cultures to be transformed with the impulse and leadership from the top (Buckman Labs, IBM and BP are only 3 of the most famous ex. of such cultural transformation). If we consider Google, surely one of the most innovative companies these past few years, its ground-breaking open culture was initiated by its founders, so therefore a top-down leadership. Enterprise 2.0 will not drastically change the balance of power and responsibility: Especially since the Enron scandal! The boss remains the boss and if he/she wants employees to stick to their job descriptions and wants remuneration and recognition processes to reflect this fact, no clever technology will fundamentally change this and Enterprise 2.0 initiatives will remain localized and accessory to standard business processes.

Now, is wanting to change the culture sufficient for a leader to succeed in this endeavour? Probably not. No matter how good a leader you are, you cannot simply tell people to start sharing knowledge and be innovative for everyone to do so overnight! James Todhunter gives a list of 6 methods for effectively fostering an innovation culture:

· Invest in your people.
· Reward the behaviour you want.
· Invest in infrastructure to support sustainable innovation.
· An important part of the innovation infrastructure is the framework to leverage knowledge
– both the knowledge within your organization and that which is external to the enterprise.
· Promote the value of innovation.
· Practice innovation in everything.

This is a good list and with a very good chance of success if followed. I would however like to add one method that should actually be the one to start with: Lead by example! Don’t count on people to do what you say, even if you reward them for it. It will surely be more effective if you start by doing it yourself: be open, share you knowledge, show off your own creative or innovative ideas (and you might then realize that special rewards are not as necessary as expected).

Knowledge Management in IT Service Management

2008-03-22T19:58:00.000Z

ITIL (IT Infrastructure Library) v2, the now internationally recognized framework for IT Service Management, was published in 2000 and at the time only implied knowledge management in IT service delivery. Obviously, managers involved in implementing ITIL based services (like myself btw 2003 and 2007) would consider and attempt to cater for the required knowledge capture/retrieval/sharing/reuse.

Here is a very good article written in 2003 about such a Manager (Michael McGaughey, Service Management Framework Architect at TXU, the leading energy retailer in Texas) who was concerned with incorporating KM in the IT service framework he was designing.
I will reproduce here only these 2 key sections:
<< [..] knowledge management goes back as far as human memory. It evolved onto stone tablets, books, file cabinets and sticky notes. But knowledge management in the IT world has always suffered from a lack of context, a lack of a problem that KM is clearly designed to fix. Service management may be the answer.
IT service management demands a customer-centric view of IT. It helps the company's IT department achieve three fundamental goals: Achieve customer satisfaction, exceed customer expectations and manage customer perceptions.
"The service management framework lives and and breathes with knowledge," said Michael McGaughey, Service Management Framework Architect at TXU, the leading energy retailer in Texas, which serves five million customers in North America and Australia. "There's a lot of knowledge used across the process silos."
>>
And:
<< Knowledge management as an IT concept has a lot to gain from working within an IT service management framework. One of the factors that led to the development of its identity crisis is that knowledge management offers very little in the way of a value proposition by itself. The value it offers is in making other processes better. >>

I really like this last paragraph. It has indeed been KM’s main issue in particular with organizations top-management, even though I would say that today with the help of Enterprise 2.0 technologies, KM can deliver value by itself.

Last year, ITIL v3 was published and I was very pleased to find out that in this edition, KM was formally taken care of as a Service Transition concept. I was even more pleased to see that it also included cultural change management! So now, IT departments are expected to formally assess and deal with the cultural change that a new service management implementation can initiate or even require! This was long overdue I would say.

"The Google Enigma"

2008-03-17T12:48:00.001Z

I found a very good article with the same title as this post by Nicholas G. Carr on Strategy-business.com (thanks to a post by Bertand Duperrin). Nicholas warns of the hype around Google’s model to foster innovation and the belief that it is the direct reason of its amazing success. But it could very well be more the product of its success instead of the cause as Nicholas writes.

Nicholas message is not to ignore Google’s example but to be careful not to assume that the Google way is necessarily the one to follow for all businesses and in all contexts.

I would like here to highlight the following two passages, both found in Nicholas’ conclusion. The first one gives the two key examples of Google strategic initiatives that businesses should reflect on seriously and use as benchmarks:

“Google’s use of powerful computers to collect and make sense of the operational and customer data flowing through the Internet and other networks provides a window into the future of many industries. And, on a related note, the company has created simple but useful systems for sharing information within and between teams, a challenge that has frustrated many firms.”

So, in other words, this is about knowing better your customers to serve them better and about effective and efficient internal knowledge sharing to leverage your human capital (what I’ve been writing about since my first post on this blog!).

The second passage is what, according to Nicholas Carr, Google does teach us:

“Above all, Google teaches us, through both its successes and its failures, that smart companies — the ones that are not only consistently innovative but consistently profitable — exhibit three qualities. They hire talented people and give them room to excel. They measure progress and results rigorously and make course adjustments quickly. And they remain disciplined in their work and their spending, curbing the instinct to do too much at once.”

I don’t think that this is this is the only lesson on strategy we can retain from Google’ success, but I agree with Carr that it all relies first on hiring talented people and then making sure to continuously leverage this human capital.

What should Web 2.0 mean for Luxury Brands ecommerce strategies?

2008-03-09T14:11:00.001Z

[NOTE: I had written this article back in 2006 but could not publish it then. I can now do so and it is still very much relevant 16 months later!]

It is bizarre how an acronym so widely used as “Web 2.0” can lack an unanimous definition. What most experts tend to agree on however is that Web 2.0 is made up of at least two key concepts (as noted by the journalist Phil Muncaster in ITWeek 02/Oct/06 issue- http://www.itweek.co.uk/ ):

“Improved user experience and collaboration.
The democratisation of information.”

The latter concept refers to the fact that information becomes ubiquitous and relatively easily and cheaply accessible by potentially anyone. Democratisation also implies virtually no control over this “open” information. Companies cannot control what is said about them and about their products. They cannot even hope to read all this information relevant to them due to the shear amount involved.

The former concept is I believe even more specific to the Web 2.0. It relates to the fact that the web users are increasingly expecting a positive and memorable experience while visiting a site. By “experience” is meant: as user-friendly as possible, as interactive as possible and as unique as possible. In the case of ecommerce sites, this will be on top of the Web 1.0 criteria such as reliability, overall performance, competitive product prices and efficient and effective integration with back-end delivery and CRM systems.

As Phil Muncaster concludes in his article: “So whether you believe all the hype or not, Web 2.0 is changing the way users behave, retailers react and enterprises interact with their staff and business partners. Those who fail to embrace it will probably be left out”.

So then what does this new environment entails for the luxury products companies launching ecommerce initiatives? As for all other companies, it means both an opportunity and a challenge. An opportunity since the Web 2.0 should enable companies to better satisfy their customers by being more in tune with what they expect and desire. A challenge because of the relative difficulty to get it right first time using emerging Web 2.0 technologies (such as Ajax, Mashup) and because of the growing concerns for the Web security and privacy issues.

I would however infer that the luxury market companies are particularly well positioned to seize the opportunity and take on the challenge. The reason is that these companies are already by nature in the business of providing customer-centred, differentiating, memorable, even unique experiences to their customers. I believe you can make a parallel between:

· The individualized experience expected when we enter a Cartier, Louis Vuitton or Gucci boutique compared with the standardized experience expected in a Tesco or Wal-Mart superstore; and

· our expected experience on the Web 2.0 compared with the original Web 1.0.

Ecommerce customers of luxury companies will expect and value a Web experience as differentiating as purchasing in their high street shops. Therefore, these companies’ ecommerce websites must be highly innovative and take full advantage of the Web 2.0 context. This is totally in line with the following statement I made in my earlier post “Customers increasingly demand more personalized products and services” in Dec/05 :

“This new competitive environment indicates that luxury Brands should focus on bridging the gap between them and their customers through co-creation of value with the customers”.

The basic principle is to build this personalized experience through collaboration with the customers, which happens to be the other Web 2.0 key characteristic!

What could this mean in practice on a website? Let’s imagine:

<<>>

Is this scenario really far-fetched? Not really. All the technologies required are already available. In fact, the concept of chatting online with an advisor has been around for years, typically for technical support services. Of course, the Web 2.0 can mean much more than this scenario. It is only an appetizer to what luxury companies’ websites could be designed to do. These companies need to first realize that they must and can be as exclusive on the Web as on the high street. They then need to engage in a sincere and continuous collaborative process with their customers to not only deliver what they seek, but to surpass their expectation.

A great little KM story

2008-03-06T21:31:00.000Z

Found on CIO.com this great little knowledge sharing story in a context where it was least expected (among retail sales staff used to compete with one another):

"Around the holidays in 2000, a Giant Eagle deli manager hit on a way to display the seafood delicacy that proved irresistible to harried shoppers, accounting for an extra $200 in one-week sales. But uncertain of his strategy, he first posted the idea on the KnowAsis portal. Other deli managers ribbed him a bit, but one tried the idea in his store and saw a similar boost in sales. The total payoff to the company, for this one tiny chunk of information, was about $20,000 in increased sales in the two stores. The company estimates that if it had implemented the display idea across all its stores during this period, the payoff might have been $350,000. Previously, "there was no tradition of sharing ideas in the store environment," says Jack Flanagan, executive vice president of Giant Eagle business systems.

Seeing the bottom-line benefits of sharing knowledge propelled the employees over their initial misgivings, spurring them to try and out-hustle each other on having the best suggestions, rather than the usual metrics. "Now they're competing in the marketplace of ideas," says Russ Ross, senior vice president of IS and CIO at Giant Eagle.

"It became a 'Look What I Did' showcase. Everyone wanted to put something in there," says Brian Ferrier, store director of Giant Eagle's South Euclid, Ohio, supermarket. "

This is a typical example of a user-initiated quick win that made a whole KM solution become effective. It does seem so simple and common-sense, doesn't it?
But why such simple and common-sense concept be so hard at implementing? "

“Forming an ‘inside-out’ company is the secret to innovation in business”

2008-03-05T10:16:00.000Z

On the PA Consulting website, I found this very interesting news article dated April 2007.
It is about a research by Dr Carsten Sørensen of the London School of Economics (LSE) and PA Consulting Group (PA). This is the part I must highlight:

“[..] The research found that IT is the enabler for innovation across the whole business. What we are starting to see is the forming of the ‘inside-out’ company, where interactions and relationships with stakeholders actually shape strategy rather than are subject to it. The research concludes that we are approaching a tipping point, where technology will be cheap enough and intuitive enough to make collaboration as valuable a source of innovation to the business as computation has been a source of efficiency. Technology is changing the way we interact and customers (business and consumer) are demanding a richness of dialogue. [..]”

First, I am pleased to see that this confirms what I wrote on the knowledge-driven organization back in 2005, and more recently in Jan 2007.

Then this article does correctly make the link between the need for a change in the organizational culture and the introduction of new technologies facilitating collaboration. It is implied that you need both in order to foster value-generating innovation throughout the organization. I spotted the following culture-related change in the article:

* Organisations that see their customers and their staff as sources of untapped potential and ideas

* unlocking this pool of innovative talent will require collaborative management and not traditional command-and-control-style management

* interactions and relationships with stakeholders actually shape strategy rather than are subject to it

* senior executives are taking a more facilitative than directorial role, acting as a catalyst or ‘lightning conductor’ for innovation wherever it may evolve

* this new outlook on innovation and technology has changed traditional management models towards a new ‘collaborate and control’ model

* You do not have direct command-and-control anymore. You are working far more across virtual teams. Teams that are brought together just for specific projects.

* The trend towards networks and away from hierarchies and the user empowerment that this entails is changing the way we interact. Executives are seeing a similar phenomenon in business, with users across the organisation demanding that businesses are more reactive to their needs and being willing to take responsibility for improving their working environment.

* In order to identify the strategic value of IT it is necessary to employ the technology in developing relationships, listening to customers, and engaging them actively in the production of innovative services

Good stuff! The culture change described here is the kind that would do away with the cultural barriers to knowledge sharing I have been repeatedly writing about (mainly here, here, here and here).

A few more high-profile articles like this one and I might be able to rest my case...

Great synthesis of KMers' current thinking

2008-03-03T19:20:00.001Z

On 22nd Jan, I informed you of Colleen Carmean's PhD work on new practices in design and support of shared knowledge environments, and that I was proud and delighted to be in the shortlist of KM specialists asked to participate in her research.
Well, Colleen has now completed the synthesis of all the participants inputs and has now posted it in a wiki for all to see. Read it! It's truly a great summary of the current thinking of KM specialists on the following 6 key concerns:

1. INHERENT CHARACTERISTICS of effective emergent learning environments
2. Fostering INDEPENDENT, AS-NEEDED KNOWLEDGE ACQUISITION
3. Fostering SHARING, COLLABORATION and NETWORKING of organizational knowledge
4. Fostering better expression and sharing of TACIT KNOWLEDGE
5. Potential TOOLS or PRACTICES for finding, creating and encouraging organizational knowledge
6. GREATEST PRIORITY in creating a more effective digital workplace

I must agree with it all as I was given a chance to revise it before publication.

You can post comments here as Colleen reads my blog or here is her site.

The importance of culture when implementing new technology

2008-02-29T08:38:00.001Z

Thanks to Bertrand Duperrin, I found out that only 6 days ago, Peter Evans-Greenwood (Cap Gemini CTO in Australia) posted on his company's very good "CTO blog" his thinking on the importance of organizational culture when implementing new technology and in particular Enterprise 2.0. Do read it. It is totally in line with my last post.

Finding the right person to help with a problem

2008-02-28T23:03:00.001Z

Here is a basic but hugely rewarding problem to resolve:

“Finding and contacting the right person (or group) within an organization to help with a problem”.

The problem can be anything that can benefit from the input of someone with a relevant expertise.

How do you do this in an Enterprise 1.0 environment (in other words, in most organizations today)?

Well, all too often you simply don’t bother trying! Why? Because you know it’s likely to cost you more resources (usually time) than you are prepared to invest, and where there is no certainty to succeed (in finding a useful soul). Furthermore, even if you did take the trouble to search and eventually find someone, there is then no guarantee this person will have the time to help you quickly enough ) or even want to help you!).

So it is often easier to instead choose one of the following 3 alternatives:

Work out the solution to your problem yourself with the people you already know and work with. In other words, you probably will reinvent the wheel.
Seek external help and usually have to pay for it. Might be faster and more effective than doing it yourself but will probably be more expensive.
Leave the problem unresolved and maybe find a (less efficient/effective) way around it (trust me, this option is chosen more often than you would think).

Why is it typically so difficult and taking too long to find someone with specific knowledge within an organization? For at least these 5 reasons:

Knowledge-sharing is not part of the corporate culture, so people are not expected and not expecting to help outside their “normal” job/responsibilities (see my list of traits of a culture not conducive to knowledge-sharing here and here)
Lack of adapted collaboration tools (Web 2.0)
Lack of “Who has done what” or “Who knows what” repositories (and not just “who’s who”).
The larger the company, the more difficult it is.
The more geographically dispersed the company, the more difficult it is.

Now, this should mean that if you deal with the first 3 points above, you’re on your way to solve the problem. Yes, this is the way forward and this is what Enterprise 2.0 initiatives are supposed to do. HOWEVER, the most important point is undoubltedly the first one. If people don’t want to share/help (for different reasons) it won’t matter what bleading-edge tools you will give them access to, they won’t use them at all or not for the reasons you would like them to (of they use them because they are told to do so, you won’t get the ROI intended).

So I am suggesting that Enterprise 2.0 = Web 2.0 + a cultural change.

Also, I now think this cultural change must be initiated from the grassroots, from the people on the front lines in the organization, and not directed by the top-management. My position on this has somewhat evolved since my first post on PKM . Instead of stating that traditional KM (management-lead) must come first and then allow PKM to support it, I now believe that the opposite has more chance of success. You should encourage PKM (user-lead initiatives) and then formalize at a company level the most popular solutions (my reading of “The Mashup Corporation” book on SOA has something to do with it). This is also Google’s successful business model to focus on satisfying the user, as opposed to Microsoft that focuses on satisfying the Management. In the long run, Google’s model will win it and Microsoft will need to adapt or die.

“Three dozen knowledge sharing barriers” compared with my “cultures not conducive to knowledge sharing”

2008-02-22T11:52:00.002Z

I have recently been made aware (on ActKm listserve) by Shawn Callahan of one of his blog post dated 03/09/06 and titled “Tree dozen knowledge sharing barriers”. Shawn was commenting on an article written by Andreas Riege (with the same name as the post).

I thought that it could be interesting to compare Andreas’ list of barriers with my list of 16 “not conducive to K sharing” cultural traits.

First, I excluded the technological barriers as these are not directly linked the organizational culture.
From the remaining 29 barriers, I manage to make 15 of them correspond to at least one of 12 of my traits. So they were mutually confirming each other.
One barrier can actually be linked to nearly all of my traits: “Existing corporate culture does not provide sufficient support for sharing practices”.

This left the following 4 cultural traits not addressed by Andreas’ list:

2. Focus on short-term objectives: the “no need to share knowledge since once objectives are met, it wont be needed anymore” syndrome.

11. Job Description framing: The 'No-one's paying us to have a wider vision' syndrome.

13. Only money talks: The 'those so-called stakeholders aren't actually funding anything directly, so they're not real customers' syndrome.

15. Modesty resulting from lack of encouragement: the 'who am I to teach others, of course they know' syndrome.

From the 14 barriers not linked to a cultural trait, I identified only 4 that each warranted a new cultural trait in my list. Here are the 4 new traits with the associated syndromes:

17. Dominance of explicit over tacit knowledge sharing:
The 'we only truly value what is written down and validated' syndrome.

18. Lack of social networks:
The 'only networks supporting business processes are important and encouraged' syndrome.

19. Lack of knowledge management strategy and sharing initiatives into the company’s goals and strategic approach:
The 'Intellectual Property is the only Intellectual Capital that is worth managing strategically' syndrome.

20. High internal competitiveness within business units, functional areas, and subsidiaries:
The 'we only share knowledge within our team since everyone else is potential competition' syndrome.

So that makes now 20 traits of organisational cultures not conducive to knowledge-sharing.

If you identify one missing, please let me know.

I suppose I must thank you all...

2008-01-22T21:40:00.000Z

Sorry for a bit of self gratification but I had to tell you about this.

I have been approached recently by Colleen Carmean, a PhD candidate at Capella University, researching new tools and practices in informal, just-in-time, self-regulated learning that contributes to organizational knowledge and effective business practices.

Colleen asked if I was interested in contributing to her research. I accepted with pleasure but what I really had to mention here on my blog is the fact that her research started with a selective analysis of Knowledge & Learning related sites (http://cmcarmean.googlepages.com/tappingknowledgeintheblogosphere ).

Colleen explains on her site:

“The study tapped into the Blogosphere's version of both popularity and peer review to determine trusted
"experts" who are writing about:

organizational knowledge
organizational learning
just in time learning
informal learning
emergent learning. “

Starting with 885 sites, Colleen ended up with a list of the 24 most trusted sites and guess what? This site you are reading now is among them!

So I must thank you all, regular readers of my blog, for your encouraging support.

Colleen then writes to define her objective:

“it is the intention of this study to gather knowledge on effective design and support of environments for shared knowledge via collective inquiry by community-identified and connected experts. How we can best design and support emergent learning in the creation of organizational and shared knowledge?”

I wish Colleen success for her PhD and no doubt I will write again about it.

Peter-Anthony Glick

It was about SOA all along! Chapter 7

2008-01-19T17:41:00.000Z

[Continuation of my commented reading of Andy Mulholland’s book: “Mashup Corporations. The End of Business as Usual”].

Chapter 7 is about the “typical” barriers to implementing SOA throughout an organization. The authors added this chapter in the 2nd edition following a suggestion by Avrami Tzur (VP of SOA at HP). I will start by saying that I was a bit disappointed with this chapter: it does literally focus on the specific resistance to SOA without considering the probable more generic reasons for this resistance. But maybe it’s me again expecting cultural issues to be mentioned everywhere! At least, this chapter has the merit of existing. I am sure Avrami was far from being the only one noticing the need for addressing this topic after reading the 1st edition of the book.

This chapter deals with the fears and needs of technologists - used to a “develop and control” centralized infrastructure – that are being asked to adapt to SOA and the flexibility, openness and informality that comes with it. These fears and needs would typically raise questions such as:

How do I know what services are available for me to use?
How do I know exactly what each service does?
What happens when a service I am using is changed or upgraded?
What happens when I have to debug an application based on services?
How does the new world of services fit and interoperate with existing IT systems? Etc,…

Five rules are then proposed to encourage adoption of SOA:

Use visibility to reduce fear, build trust
Put it in writing
Extend existing management processes to SOA
Support new pattern of collaboration
Provide incentives for SOA adoption

The authors do introduce these rules as enablers of communication and knowledge sharing. I agree. However, if your organisation has a command and control culture where knowledge sharing is not the norm (I take you back to my 16 traits of such a culture) following these 5 SOA adoption rules won’t be enough. But maybe it could be argued that a “command and control” organisation would not initiate a SOA in the first place (now that could be a topic for a lively debate).

The authors do explain that the << adoption of SOA do reflects an evolution in the skills and systems of a company >> ( I would like to add that it reflects an evolution in the organisational culture as well). This evolution is made of 3 stages: Integration, Architecture and finally Operations. I finally noted that successful SOA adoption will rely on 3 groups of people: the Enterprise Architects or designers, the Providers or builders of services, and the Consumers of these services.

It was about SOA all along! Chapter 6

2008-01-09T18:19:00.000Z

[Continuation of my commented reading of Andy Mulholland’s book: “Mashup Corporations. The End of Business as Usual”].

Chapter 6 is about “Internal IT” or the effect the SOA transformation can/should have on the internal IT department/functions. With the help of a meeting with all the managers of the fictitious company Vorpal’s IT department, it explains that a SOA does not only support the informal edges of the organisation but also the formal transactional hub. What unifies it all are “the processes that flow through the business” and link “the informal processes at the edge” with “the more formal controlled processes at the hub”. It is therefore important (in order to successfully become a service-oriented organization) to adapt the company’s functional structure. The functions must mirror the key business processes that SOA has formalized.

The authors then suggest a new structure for Vorpal’s IT department. Below are the original (standard) structure followed by a new service-oriented structure:

Old:
End-user support
Development
Infrastructure (CTO)
ERP
Engineering
New:
· Composition (about defining the common services)
· Services Creation (about development of the services)
· Disruptive Innovators (about the creation of new services)
· Consolidation (about the link with the core systems)
· Services Repository (about keeping track of all the services available)

The authors do make it clear that this is only a suggested structure and that each organization would adapt it to suit their needs.

And then reorganizing the IT department around SOA is only a start. The whole organization structure should be reviewed. For example, I can see new cross-functions between sales, marketing and public relations departments: Services to a specific customer group could benefit from having a function (an individual or a team even) pulling resources from these 3 departments to better satisfy these customers no-less specific needs.

It was about SOA all along! Chapter 5

2007-12-30T18:14:00.000Z

[Continuation of my commented reading of Andy Mulholland’s book: “Mashup Corporations. The End of Business as Usual”].

With the family reunion of the Christmas break, I have only managed to complete Chapter 5. In my defence, it is probably the most important chapter of the book judging from the powerful messages it conveys. The following chapters seem to be only about some of the consequences of taking on the challenge defined in this chapter: “Creating a Program of Service Enablement”. The authors describe such a program in terms of three levels or steps:

1. Designing a Single Service.
2. Designing Systems of Services.
3. Service-Enabling your Enterprise Applications.

According to the authors, no company has yet (at the time of writing) reached level 3! This is probably still true but I wonder if a company like Google that seems to have been implementing step 2 for years now, is not already well into service-enabling its core applications (and maybe they were designed as such from the beginning). In any case, what is implied here is that the first companies to successfully reach (and complete) step 3 are likely to be the success stories in the coming years.

The chapter starts with a wonderful email sent by the CEO of the fictitious company Vorpal. She writes to all the staff to involve them in building a new service-focused culture. The goal is to foster technological innovation throughout the company and “take shadow IT out of the shadows”. Once again, I’m not aware of many CxOs (let alone CEOs) with such an open-mind on new technologies and the courage to initiate and lead the drastic cultural change that a SOA demands. Such forward-looking leadership is indeed a must for a successful SOA implementation.

Chapter 5 describes 5 rules for successful SOA implementation. I want to comment only on the first two:

This chapter’s first rule is about promoting Shadow IT. The authors are quick to note that it is not a new phenomenon. Probably since IT was provided to people to do their work, most of them would work out their own “tools, procedures and workarounds” to increase efficiency at doing their job. Most importantly, this personal or team innovation is done without the IT department (official) involvement and in most cases even without it’s knowledge. This unofficial but productive IT is what the authors define as Shadow IT. I will quote their conclusion on this topic: “Failure to embrace and support Shadow IT in the long run means wasted resources, and inability to maximize the value of your company’s collective candlepower, and lost opportunities”.

The second rule is “Institute a Service Culture”. This is for me the cornerstone of an SOA implementation. The author only give this rule half a page but a lot more is implied. Service-enabling an Organization means adapting its internal culture. “Creating a lifecycle process in which services are made, reported, judged, and finally supported by IT, is essential to maximizing the potential of your homegrown and ecosystem-developed services.” I would add that all this creativity and innovation resulting in productive services must be formally recognized and rewarded. New pay, rewards and even promotion mechanisms will be needed to foster Shadow IT.

Going back to the second level of a Service Enablement Program introduced above, the authors give a brief but useful explanation of how to build a good set of services. In a nutshell, [each service must be] “sufficiently granular to allow for easy reuse; good design is decomposing process steps into a suite of services that can be orchestrated to solve the business need in question, while allowing for recombination.” This implies a potentially large number of services that will then need to be cleverly referenced, tracked and maintained.

The last comment I will make on this chapter refers to its last section (before a set of real life examples) titled “Rethinking Your Architecture”. SOA implementation will eventually (when reaching the level 3) mean a completely new organisational physical structure, and not just limited to IT but hierarchies and departments as well. When embarking seriously on the SOA adventure, you must be ready for significant no-turning-back – sometimes painful - changes that will transform your Organization.

It was about SOA all along! Chapter 4

2007-12-19T16:11:00.000Z

[Continuation of my commented reading of Andy Mulholland’s book: “Mashup Corporations. The End of Business as Usual”].

Chapter 4 is about how SOA can transform the relationships with your suppliers. I will quote from the book how a Vorpal supplier defines these SOA-driven relationships it has built with it’s customers (p.57). He is responding to one of Vorpal’s manager who noted that the collaborative meeting they just had was unusual in style:

“Yes, we’ve noticed [this change] as soon as we created our new services and started doing mass customization for our customers, the relationship changed pretty quickly from a Darwinian struggle to a win-win situation – from conflict to collaboration, if you will – because we’re both going to make a lot of money that way. I like to think of it as negotiation jujitsu – it’s now my job to use your strength to create new business for us instead of just holding the line on price while you pummel me.”

With an SOA, suppliers and customers work hand-in-hand to generate value. They help each other out. Another useful quote on the next page is:

“[…] don’t just define your suppliers as services – define your own operations as services to them”.

You could say that you are helping your suppliers to serve you better. It is then in fact suggested that we should think of our partners and suppliers as members of ‘our’ dynamic ecosystem, where each member contributes directly or indirectly to the growth of all the others. Another good concept given is to see your suppliers as a channel. Your supplier’s customers are potentially new customers for you.

It was about SOA all along! Chapters 2 & 3

2007-12-17T15:58:00.000Z

[cont. from previous post about my commented reading of Andy Mulholland’s book: “Mashup Corporations. The End of Business as Usual”].

After reading chapters 2 & 3, I realised that I should clarify something important. When I state that my writings on this blog were about SOA all along, I mean that SOA is probably the best value-adding, customer-facing, tangible web-based implementation (that I know) of a knowledge leveraging strategy. What I do not mean is that SOA is the only way to leverage organizational knowledge, nor do I mean that a company-wide change process to establish a knowledge sharing culture must incorporate some degree of SOA in order to be beneficial. Also, SOA is primarily concerned with online services on the Web but of course, not all transactions are online! Having said that, if the technological aspect of SOA might probably not apply in a meaningful sense to all businesses; its associated cultural implications should be relevant to all.

SOA first advantage [over most other knowledge leveraging initiatives] is to be directly concerned with increasing/generating sales and this should help catching the attention of CxOs.

In chapter 2, a fundamental principle of a SOA is explained: extending IT to the edges of the company. This does not only mean involving the customer-facing collaborators in the creation/evolution of the services to the customers, it means to involve outsiders as well. That is collaborators outside the firewall (to use a technical view) and not on the payroll (well, they could get paid but not with a salary). So, do get this straight: the suggestion is to enable outsiders to “add their own services that create new revenue stream”. The cultural change required to support this is to have your whole company at the service of the people at the edge: the front-line/client-facing collaborators and any trustworthy outsiders with an interest to grow your business (see my knowledge-driven and customer focused organization diagram )

From chapter 3, I will retain in particular the advantages of services (Web 2.0) over traditional Enterprise Applications, with the guiding principle of releasing control to communities of users. The importance of a legal framework also must be noted, in order to secure a service-enabled commercial environment that heavily involve outsiders.

It was about SOA all along! (Chapter 1)

2007-12-13T17:42:00.000Z

[cont. from previous post about my commented reading of Andy Mulholland’s book: “Mashup Corporations. The End of Business as Usual”].

Here are my thoughts after reading chapter 1 of the book “Mashup Corporations. The End of Business as Usual”.

This book illustrates its arguments with the help of a tale of a fictitious company Vorpal going through the process of implementing SOA. The authors do stress that it is a rather idealistic scenario, but I couldn’t help thinking that the way in which the realization of the need for a more flexible infrastructure came about, was unrealistic for most organizations today. You have this young clever marketing manager who explains to the CEO how he uncovered a new unsuspected source of income. In order for Vorpal to benefit from it, it had to find ways to allow online ordering flexibility.

The thing is, if you currently work in a (relatively large) organization where a n-2 manager can simply request for a meeting with the CEO to talk about an exciting personal experience that may be of interest to the company, already consider yourself lucky. Then if you are among the lucky ones, if the CEO does listen to your entire story in details, then calls in on the spot the CIO or any other senior directors to listen to it too and give their opinion, consider yourself to be privileged to work with an exciting CEO with a modern management style. Now, if your story is likely to end up initiating a formal project in which you will have a leading role, please tell me the name of your company to add it to my shortlist of preferred employers!

Anyway, the authors’ intentions were not initially to consider all the likely resistance to SOA adoption. Instead, the Vorpal scenario helps us understand typical reasons for needing SOA and a typical implementation process with its cultural, organizational and technical impacts. In this second edition of their book, the authors have added chapter 7 “Overcoming barriers”, after realising how important the challenge to convince decision-makers of the need for SOA was in many companies. So, I’ll come back to this issue after reading this chapter.

The key concept I will retain from this first chapter is the difference between “Hub IT” and “Edge IT” and that “SOA flourishes at the edges”, just inside the firewall or literally outside of it.
I will quote a very useful definition of Web Services: “[they] are standard approaches to exposing the capabilities of a company’s web site or internal systems to other web sites or systems by bypassing the user interface and connecting directly to the underlying technology”.

To be continued…

It was about SOA all along!

2007-12-12T13:31:00.000Z

I was recently introduced to Andy Mulholland by a mutual friend. After reading some recent articles on his blog I quickly realized I had to read his latest book about Service Oriented Architecture (SOA) titled: “Mashup Corporations. The End of Business as Usual”. I ordered it on the famous mashup-rich website Amazon and started reading it yesterday. After only reading up to the end of the Introduction chapter, it suddenly stroke me: All my thoughts and ideas that initiated the articles on this blog since its creation in 2005 were calling for, relating to or assuming SOA! And the most amazing is that I never even mentioned SOA.

My understanding of SOA was that it was a modern method to organize the IT infrastructure for a more flexible applications delivery. So, I had the technologist view (sorry but I’m an IT guy after all) and was missing completely the point. SOA is not just about delivering services and the IT infrastructure, it is first about the adoption of new business models and a conducive corporate culture. Business models! Corporate culture! To those of you who have been in touch with my blog for a while, aren’t these recurring topics in my writings? Oh boy, how this realization got me excited!

So, I decided that I will keep posting about my reading of Andy’s book, and how it will surely make my understanding of the leveraging of organizational knowledge evolve to another level.

I will stick here to this enlightening Introduction.

It gives “five kinds of relationships upon which SOA will make the most impact” and the associated questions it will attempt to answer are:
<< How can you harness the ideas and energy of [innovators] eager to help [from inside or outside the company]?
How can you bring your customers closer to your core business processes?
How can you create a win-win relationship with your suppliers instead of an adversarial one?
How can [IT enable] innovation to break new ground while protecting critical data?
How can you best structure your IT resources to reflect the needs and new capabilities of SOA?
>>

The virtuous process of Human Capital Formation is concerned with the first question. My article on this process was focusing on the employees, but it could be adapted to cater for the contribution of people outside the company (I might do this when I have time).
The second question relates to one of the most important concept I have written about on my blog: Organize the whole company around the customer-facing functions in order to be closer to the customers and therefore satisfy them better. See “knowledge-driven not simply customer-driven”, and “becoming a knowledge-driven organization in response to more knowledgeable customers in the luxury market” and also a more specific case “knowledge-sharing for a Retail Manager”.

The third question is about the collaborative playing field of the Knowledge Economy where companies must collaborate with in fact not only their suppliers and customers, but even increasingly with their competitors.

I will leave the last two questions more concerned with the company’s IT function/department for now. Of course, with my experience there is a lot I could say about it, but this blog was initially avoiding this subject and no doubt I will be drawn into it in later chapters.

Let's read on...

The Knowledge Challenge (for Consulting/outsourcing firms)

2007-12-03T10:52:00.000Z

My latest contribution on Thinkingstreet.com :

http://thinkingstreet.com/business/2007/12/02/the-knowledge-challenge/

Peter-Anthony Glick

Mesh working rather than Matrix working

2007-11-30T18:09:00.000Z

Read this very good post by Andy Mulholland (Cap Gemini CTO) about the impact of Web 2.0 collaboration on organizational structure and working practice. Andy identifies the new working practice as Mesh working:
http://www.capgemini.com/ctoblog/2007/11/this_is_going_to_be.php

Here is how Andy defines Mesh working:

<<[…] The change in how people work is focused on Web 2.0, and I have chosen to label this as Mesh Working to differentiate it from Matrix Working. Matrix working is broadly the capability for individuals to work at the specific tasks in which they specialise for a variety of managers, and is made possible by using client-server to allow the separation of the client activity from the data consolidation on the server. However it is at heart a data centric transaction based working method where relationships both between people and systems are ‘managed’ through a close coupled environment. Put simply the relationships in Matrix working are always pre determined, fully defined and use known data.

Put equally simply Mesh working is loose coupled, for both the people and systems, relying on forming the relationships required through the ‘interactions’ leading to the definitions of who, and what, should be found and used. The Mesh of people and systems is potentially a never ending huge open environment extending externally as well as internally rather than the closed internal world of Matrix working. […]>>

A Mesh of people is really what I also have in mind when I think of a Web 2.0 collaborative environment. It is organized chaos. Andy ends his post with this good assessment of what this means from a competitiveness point of view:

<<[…] Competitive advantage is shifting from the cost management of transactions in the back office to business optimisation in the front office and the external market. Globalisation is forcing all enterprises to compete in this space so ultimately Mesh working is being driven as a necessary response to a changing Business world. It’s a World that takes us way beyond internal agility, and flexibility, through Matrix working, and into external responsiveness through Mesh working. >>

I totally agree with this conclusion. However, leaders need to be careful about what they first need to do about it. Essentially, it first depends on their organization’s current culture. Mesh working is not compatible with an environment with a heavy hierarchical structure, where horizontal communication – let along team working - other than for prescribed “routine” processes is scarce. You cannot declare mesh working, you cannot impose it. You need to nurture it, gradually implement a conducive organizational environment, starting with a clear and unconditional support from all the CxOs. A “do what I say but not what I do” behaviour will surely not succeed.

If as a leader you want your collaborators to willingly share their knowledge outside routine business processes, you must lead by example. Maybe start a corporate personal blog accessed by all and use it to tell your vision. Mesh working is not a concept that can be applied only to the grass roots of your organization and leave the upper echelons unchanged. Mesh working implies a fundamental change structurally, culturally and technologically. All organizational values, processes and methods must be reviewed and progressively adapted to the new way of working. For example, the pay and reward mechanisms must cater for the new importance given to knowledge-sharing, idea generation and innovation.

Now, Andy implies in his article that Mesh Working is in fact not an option and that it is happening whether you like it or not. Thinking that as a leader you have today a choice to ignore it would be like if in the late 80’s/early 90’s, you would have been thinking the same of the Matrix working brought by the networked PC and the Information Age that followed. “Symptoms” of Mesh working can very probably be detected in your organization. One obvious reason is that millions of people have already socially embraced this concept largely thanks to the Web 2.0 and, seeing the benefits, it is only natural that they try to extend this behaviour in the workplace. Another reason is that some of your customer or supplier organizations will have already made the transition to Mesh working, and their collaborators will expect the same behaviours from your collaborators.

The pressure will therefore mount on all organizations to fully embrace the Knowledge Economy. Traditional Intellectual Property (e.g. Brand name, patent and trademark) will no longer suffice to build and maintain competitive advantages: Intellectual Capital leveraging through effective and efficient Mesh working is to become the key to successful business.

Peter-Anthony Glick

The Age of Collaboration

2007-10-15T14:25:00.000+01:00

Read the following article in CIO Today:

http://www.cio-today.com/story.xhtml?story_id=0020006F2KP6&page=1

It starts with this unfortunately correct quote from an Accenture executive:

<< When it comes to collaboration, many companies have a long way to go. "We are early in the cycle, maybe the second inning," says David Smith, head of the human performance practice in North America for Accenture, a global consulting and technology services firm. "Companies are beginning to attack it. Very few are getting it right." >>

The Age of Collaboration as the article defines it below is a direct consequence of the Knowledge Economy, considering Knowledge as the most important asset:

<<[…] The 21st century is likely to be the age of collaboration because many of today's problems are complex, often demanding cross-disciplinary expertise. Collaborative technologies are also in demand by companies that have global staffs and greater numbers of employees who telecommute. Supply chains demand collaboration among dozens of companies. Some technical problems are so expensive to tackle that even competitors collaborate. For example, IBM, Samsung Electronics and Chartered Semiconductor Manufacturing cooperatively develop semiconductor manufacturing processes. ST Microelectronics and others recently joined them. Finally, there's evidence of a societal shift toward collaboration as more workers network around the clock via cell phone and computer. In the July-August 2007 issue of Harvard Business Review, authors Neil Howe and William Strauss discuss the effects of generational differences on this trend. Those born between 1982 and 2005 -- the first generation to grow up with mobile digital technology -- expect nonstop interaction and cooperation with peers. "They will tend to treat co-workers as partners rather than rivals ... and use information to empower groups rather than individuals," the authors write. […] >>

And the article concludes with this short but to the point warning:

<<[…] In the years ahead, the winning organizations will be those that learn to be collaborative and share employees' knowledge. >>

How many of these articles will be needed for the majority of leaders to finally understand the importance of a knowledge-sharing culture for their organizations? The ones who wait for their competitors to try it first will regret it.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com/

European organizations are failing to effectively create and manage their intellectual capital

2007-08-31T18:18:00.000+01:00

I want to attract your attention to the MAKE reports found on this link:

http://www.knowledgebusiness.com/knowledgebusiness/templates/
TextAndLinksList.aspx?siteId=1&menuItemId=133

Do start by reading the one on the "global" MAKE winners. It is fascinating and here are the extracts I want to highlight:

The 2006 Global MAKE Winners have been recognized as leaders in:

• creating a corporate knowledge-driven culture
• developing knowledge workers through senior management leadership
• delivering knowledge-based products/solutions
• maximizing enterprise intellectual capital
• creating an environment for collaborative knowledge sharing
• creating a learning organization
• delivering value based on customer knowledge
• transforming enterprise knowledge into shareholder value
[..]

Successfully managing enterprise knowledge yields big dividends. The 2006 Global MAKE
Winners trading on the NYSE/NASDAQ showed a Total Return to Shareholders (TRS) for the tenyear
period 1995-2005 of 24.2 % – over twice the average Fortune 500 company median.

[...]
The most visible trends over the past nine annual Global MAKE studies are:

• a growing number of organizations are taking on ‘Global’ characteristics – especially
consulting and professional services firms, financial services, energy and media companies.
These ‘Global’ organizations tend to operate as ‘independent’ companies within a Federal
structure and without the traditional corporate head office.
• the capability to innovate and create new products is seen as the competitive edge across a
wide range of business sectors.
• Asian knowledge-driven organizations are competing on an equal knowledge ‘footing’ with
their European and North American counterparts.
• European organizations are failing to effectively create and manage their intellectual capital.
Although US companies maintain a lead in this area, Asian businesses are rapidly narrowing
the gap and may surpass American firms as regional wealth generators within the next five
years.

I let you draw your own conclusions. If you're a leader of a European Company, I hope you got the message loud and clear.

Peter-Anthony Glick

The Cultural Challenge

2007-07-27T09:48:00.000+01:00

Dear all,

I have not posted here for a while, sorry. Have been too busy recently.
However, I did manage to write an article related to cultural differences for the very good site Thinkingstreet.

Here is the link:
http://thinkingstreet.com/business/2007/07/26/the-cultural-challenge/#more-903

Peter-Anthony Glick

Knowledge is only in our minds or not?

2007-06-19T22:42:00.000+01:00

Nimala recently asked on her blog to suggest KM topics for her to write on. I suggested the following:

"Recently, I have been confronted with "KMers" (not sure I agree that they are) that consider that you can only manage information and not knowledge because "knowledge" is only in people's minds, and that what can be communicated is only "information". What would be your arguments to support the view that knowledge can be "managed" and is not only found in our minds?"

Read her interesting response and my subsequent comment here:
http://nirmala-km.blogspot.com/2007/06/can-we-manage-knowledge.html#links

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com/

Asking the right questions to assess an Organization’s culture.

2007-05-27T16:20:00.000+01:00

Nirmala Palaniappan (or Nimmy as she seems to like to be called) an experienced KM professional with Wipro based in India, wrote a post on Bob Sutton’s blog comments, and spotted a very good comment by one of Bob’s readers (in fact it is one of the best comment to a blog post I’ve seen) Wally Bock, a leadership consultant (http://www.threestarleadership.com/ ). His comment was in response to a question asking what are the questions to ask employees of an organization to get a feel of the dominating internal culture. Wally suggests the following 3 questions:

What kind of people gets promoted around here? The behavior and performance you reward is what you'll get more of.
What "bad" behaviors are tolerated here? This is good for patterns of behavior.
What kinds of stories do people tell each other? Stories are the carriers of culture. Beware if all they tell are "dumb boss" stories. Understand that service is a value if what you hear are "heroic service" stories.

Reading these excellent questions, I realised that answering them would give you a hint whether the culture is conducive to knowledge sharing or not. In other words, whether the 16 syndromes are present or not.

For instance, when promotion depends more on whom you know above you in the hierarchy rather than on your achievements, experience and competences; this would indicate a lack of trust, constant political games and most probably a highly hierarchical structure.
When the tolerated bad behaviours include selfishness to meet personal objectives, it would indicate strict Job Description framing, lack of availability of experts, rewards only for individual achievements, and only short-term objectives.
When the stories often speaks of ‘them’ versus or against ‘us’ for example, highlighting the differences between groups/departments/teams within the organization; this would tend to indicate a culture of information silos with poor communication/collaboration between them. A general lack of awareness of useful internal knowledge that people could benefit from is also very likely in such a context; and probably the groupthink effect is frequent as well.

Also recently, an APQC newsletter directed me to an article written by Susan Elliott Blashka about a presentation Nimmy gave during the APQC’s May 2006 KM conference. Nimmy’s KM toolkit is very interesting and I might write about it in another post. However, I will here highlight the list of questions she suggested for helping a company assess its capacity to leverage knowledge though capture and dissemination:

<<… Asking the following questions, Palaniappan said, can help a company gauge its capacity for explicit knowledge capture:

Do we know what we know?
Are our practices, structure, processes, and systems well known and easily accessible?
Do we look toward the past and capture our learning?
Do we know who’s who?
Are we able to recognize patterns in our business?
Do new employees get into the groove quickly?
Does our workflow consider knowledge needs?
Do we have processes and tools to manage our knowledge artefacts on a continuous basis?

She posed other questions that relate to explicit knowledge dissemination and utilization:

Do our systems work together? Are they integrated?
Do we find ourselves reinventing the wheel?
Do we use the knowledge that we capture? Do we leverage technology to retrieve and access knowledge?
Does the organization get together and learn? Does the organization work together—sharing and collaborating?
Are there sharing mechanisms in all our knowledge-intensive processes?
Does the workflow consider knowledge needs?
How easy is it to find and utilize information?
Is there consistency in the performance of functions across the organization?

[…] To determine the state of an organization’s tacit knowledge capture, Palaniappan said, individuals must ask themselves:

Do our people policies and practices emphasize learning, sharing, and teaching?
Does the organization spare the time to stop, think, and learn?
Is it easy to find and access people (experts)?
Does the organization have listening and questioning habits embedded in its culture?
Is “retiring work force” a serious challenge?
Does the organization operate primarily in the area of consulting and knowledge-intensive services?

And for the last category, tacit knowledge dissemination and utilization, Palaniappan presented the following questions:

Does the organizational culture emphasize trust, win-win, and excellence and innovation through collaboration?
Are like-minded people or people with similar interests able to locate and work with each other?
How fast is the organization learning?
Do people make time for mentoring and thinking and learning together?
Does the organization know who needs whom?
Are roles defined based on knowledge needs? Is succession planning knowledge-focused?
Does the organization understand its knowledge requirements to a significant level of detail?
Is the captured explicit knowledge under-utilized?

Using Nimmy and Wally’s questions, we should be able to assess fairly well how conducive to knowledge-sharing an organization’s culture is. This strengthens my view that in order to successfully make an organization become knowledge-driven, one must start by addressing the internal culture. The early introduction of new tools and technologies should only be to support this necessary cultural transformation. Furthermore, the less conducive to knowledge-sharing an organizational culture is, the more the drive for change must come from the Organization’s leadership.

Peter-Anthony Glick

http://leveragingknowledge.blogspot.com

Sarkozy’s goal-driven government structure

2007-05-22T21:28:00.000+01:00

Nicolas Sarkozy, the newly elected French President, is completely rearranging the Cabinet as it has never been done before. He is grouping departments together under the same boss (minister) that never worked together. He is also breaking up departments for the first time. The central principle is a very clever one: The Cabinet’s departments are formed on the basis of their main goal and purpose, no longer on the basis of their functional relationships. For example, the goal of transforming France into a “Green” country requires departments such as “Environment” and “Energy” to be joined together (the “Energy” would have usually been managed by the Economy and Finance” dept). Another example is to remove the management of visas from the Interior department, and associate it with the dept responsible for “Integration” and “National Identity” to form a new dept for Immigration. The goal here is clearly to have a more holistic approach to the issues related to immigration.

Whether or not we agree on these political goals is not my interest here. I am however intrigued by the implications of these drastic departmental changes for the civil servants affected. The media have already reported a lot of mostly worried comments from some managers, and the point in common I could identify was anticipated problems due to cultural differences! Here we go again with the importance of Organizational Culture but this time in the Public sector. Another significant impact due to some redundancy in activities will be a reduction in the workforce.

The most telling case is the one affecting the separation of the “Labor” dept from the “Economy & Finance”, and its association with the “Social Relations” dept. In the Labor dept, you typically find the ones who came out of the French civil servants schools with the top marks. They are usually very good in math, very rigorous and methodical. In the Social Relations dept, it could hardly be more the opposite! They usually graduated with the lowest marks, have more “artistic” mindsets (rather than scientific) and have better communication skills. Both sides clearly have no idea how they are going to work together! Nicolas Sarkozy’s idea here is to give them a common goal of improving labor issues, with the realisation that it will require a combination of economic and social changes. For example, one of the objectives announced is to level the salaries between men and women within two years (today in France, men can be paid up to 40% more than women for the same job)!

It will be very interesting to see how all these departments learn how to work together. These collaborations will need to be rapidly effective and efficient for the new Government to meet its objectives and convince the French people that it is on the right track. I wonder if someone will think of calling on the services of Knowledge Management consultants.

I now come to the point I really wanted to make here: does this goal-based organizational approach make sense for a private company?

We could start with an example: consider the strategic goal to “set a rate of annual increase of say +20% for retail customer loyalty”. For simplification, that is the number of existing customers purchasing at least once each year (I am assuming a luxury goods industry here). Typically, such an objective would be given to the Retail department. Some other departments such as Marketing might also be made aware of it and asked to assist. Now, what would it mean to adopt Sarkozy’s approach? You would need to think out of the box and regroup together under the same leader various departments or teams (parts of departments). I can suggest the following list for this example (but this exercise is very context-dependant, so each situation can demand a different organization) :

The Retail department
The part of the Customer Service department (After-sales services) specifically dealing with Retail customers (as opposed to wholesale).
The part of the marketing department focusing on the retail market.
The Public Relations department.
The Press department.

Possibly, you could even include individuals or teams from some of the shared services departments that usually devote most of their time for Retail matters. I can think possibly of:

Information Systems (IS) support professionals. For example, the team supporting the CRM application, a key tool for such a customer-focused objective.

For the shared services, the question to ask is: “will the individuals or teams concerned add more value by being integrated into this new “Super Retail dept” or by remaining closely linked with all the other teams within their respective department?” You should really consider this from a Knowledge sharing point of view. For an IS support Analyst to report to the Retail Director would undoubtedly facilitate his/her understanding of the business needs and deliver tailored support. However, from this point on, he/she ceases to be a shared resource and the cooperation with the rest of the IS department is then seen as secondary. In other words, this makes sense if the workload generated by the Retail department’s IS requests justify this IS Analyst to be full-time focusing on them.

So then, supposing a Company implements this goal-driven organization, isn’t there a risk to have to re-organize too often when the strategy changes? Yes, but I don’t see this as a risk if this process of reorganization becomes engrained in the Company’s culture. The whole Organization must be built on principles of flexibility: flexible structure, flexible processes, flexible roles. This implies in turn a knowledge-sharing culture. Employees need to be used to share knowledge across departmental boundaries. In fact, there should be no internal boundaries when it comes to knowledge sharing (except for what needs to remain confidential). Such flexibility of course wouldn't typically suit more an Organization operating in a fast-moving/fast-changing market, but it could be argued that all markets are changing increasingly faster in this flatter World.

Peter-Anthony Glick

http://leveragingknowledge.blogspot.com

The search for the unified definition of Knowledge...

2007-04-30T23:16:00.000+01:00

I could not resist!

Knowledge has nearly as many definitions as the number of authors who wrote about it or about a related subject such as Knowledge Management (by the way, you can find quite a few definitions of KM as well and maybe this explains that).

Well, guess what, I had to give “my” own definition!

On the ActKM listserve (http://www.actkm.com/ ) a still on-going debate on the definition of knowledge generated very valuable insights. I have extracted a few extracts and composed a definition attempting to synthesize the thinking of all these bright individuals:

Dave Snowden (http://www.cognitive-edge.com/ ) quoting Prusak and Davenport in their book “Working Knowledge”:

"Knowledge is a fluid mix of framed experience, values, contextual information, and expert insight that provides a framework for evaluating and incorporating new experiences and information. It originates and is applied in the minds of knowers. In organizations, it often becomes embedded not only in documents or repositories but also in organizational routines, processes, practices, and norms"

Joe Firestone’s definition (http://www.kmci.org/media/Whatknowledgeis%20(non-fiction%20version).pdf ):

“Knowledge is a tested, evaluated and surviving structure of information (e.g., DNA instructions, synaptic structures, beliefs, or claims) that is developed by a living system to help itself solve problems and which may help it to adapt.”

Han Van Loon’s version of Joe’s definition (http://www.lc-stars.com/ ):

"Knowledge is a learned and analysed structure of awareness based upon
information (e.g., DNA instructions, synaptic structures, beliefs, or
claims) that is developed by a living system."

A suggestion of a synthesis:

Knowledge is a learned and evaluated fluid mix of framed experience, values, contextual information and expert insight; that is developed by a living system. In organizations, knowledge often becomes embedded not only in documents or repositories but also in organizational routines, processes, practices, and norms.
Living systems use knowledge either instinctively or in a state of awareness (typically the latter first then the former through acquisition of reflexes for repetitive actions) to compete for resources and survival, through solving problems, adapting to challenges and setting objectives.

Still on the ActKM listserver, Kaye Vivian (http://dove-lane.com/ ) writes:

“The abstraction we call "Knowledge" has three aspects (I propose):
(1) what is acquired by learning
(2) the sum of everything known
(3) a state of awareness
and perhaps a fourth for those who argue that knowledge can exist in neural, hormonal or sensory systems:
(4) instincts."

Kaye goes on then asking us all if we can think of an instance of knowledge that does not fit into any of these four aspects. Assuming for a moment that none can be found, I think that my suggested definition above does try to cater for all 4 of these aspects.

But hold on! Don’t get over excited! I surely have not suddenly stumbled on the unified definition of knowledge. I will post it on ActKM as well and I anticipate quite a bit of constructive criticism. I will keep you informed and will amend the definition accordingly.

So watch this space...

Peter-Anthony Glick
http://leveragingknowledge.blogpsot.com

Questions to Verna Allee on how to start a Value Networks analysis

2007-04-21T22:01:00.002+01:00

This week I attended a (tel. conf.) presentation by Verna Allee on Value Networks. I then sent her 3 questions (in blue) and here are her answers below:

Can a VN approach be used to initiate a cultural change in an organizational context where hierarchy is prominent, departmental boundaries are strong and guarded and knowledge tends to be protected rather than shared? Or is it an approach only effective when the value of collaboration and knowledge-sharing is already recognized?

Absolutely it can be helpful in culture change. Value network analysis (VNA) zeros in on the most mission critical and essential intangible exchanges that support the work. This is not just "nice to do" stuff and it is not some vague encouragment to "share your knowledge." What people spell out, through conversations, are the specific deliverables and behaviors that they need and expect from each other in order to work effectively and build good relationshps. "Knowledge" is not a deliverable - it is an asset - but you must convert that asset to some negotiable form of value in order to put it into play to create value. You extend your knowledge in very specific forms: a report, professional advice, market intelligence, referrals, etc. VNA forces people to negotiate around intangibles such as various forms of knowledge in a very clear,specific direct way. Forget "knowledge sharing" - that doesn't meananything. "Timely input of market intelligence," is a specific knowledge output that can be delivered, can have performancestandards, and that someone can be held accountable for. The very process of this negotiation "loosens up" the knowledge flows because there is an intuitive sense of fairness and reciprocity that kicks inonce people talk about knowledge sharing in this way. It is a very interesting dynamic. You aren't beating on this big concept of "culture" but are focusing on the very specific behaviors that are essential for people to successfully work together. Making those "visible" in this way is very powerful, not only for affirming how important they are but also for making it much more likely thatthey will happen. For more tips on naming intangibles see ValueNetwork Mapping Tips at http://www.value-networks.com/howToGuides/ValueNetworkMappingTips.pdf

2."What is the most effective method for collecting the informationneeded to build a VN diagram? Is it assumed that a relatively highproportion of subjectivity will be captured?"

There are two different approaches for different purposes. If you are using VNA as a collaborative sense making tool then facilitating the mapping as a group process is absolutely the way to go. You WANT the subjective nature of value to become clear to the group - this is a major "ah ha" and learning that can help a group of people dramatically reframe what they are doing and start thinking about value in a whole new way. It also is a beautiful way to surface unspoken expectations and the "mental models" of how people are really thinking it all works and about different issues. I have used it this way for years with great success. In this case most of what people need to discover happens in the mapping process, not in the deeper analytics.

In other cases you absolutely do not want the value network analysis to be skewed by subjective input - and you will want to run the more advanced analytics in order to see patterns and opportunities. This is especially true when you are doing something like a market space analysis or a large scale analysis like we are doing for the European Commission. There we are evaluating innovation networks across all 255 regions and 25 nation states. We now have the technical capability to use real corporate data sets to generate the value network visualization. For example we took a month of call data for all the calls handled by Cisco's Customer Interaction Network and used the data to generate the value network visualization. These kinds of data sets can be coded for tangible and intangible exchanges and the "real" network patterns are revealed. In the case of the European Commission we have identified 4 network archetypes within these large scale innovation networks depending on the real purpose of the network. In some cases the stated intent ofthe funded project was to do one thing, but the data shows that they actually created something different. Very interesting. The application I am referring to is the open source GenIsis application developed by my brilliant colleague Oliver Schwabe. The open source version uses an Excel-based workbook to capture and organize the data. If you are interested in the enterprise level database version you will need to contact me off-line, but the open resource version is readily available and you can learn about it, and download it. Some of you may also be interested in the value network data model that is being supported by the Value Networks Consortium, which is sponsored by companies like Cisco and is leading standards and open source tools for value network analysis. http://www.vncluster.com . Value network language and models are popping up everywhere and someof it is very good work, but there is also a lot of "junk" or old wine in new bottles masquerading as value network analysis. The consortium is a good way to stay grounded in the quality work and avoid some of the pitfalls.

3. "What is the typical scale and scope of the very first "proof> of concept" VN implementation for an organization? Scale meaning> how large is the section of the organization to consider. Scope> meaning how many processes to consider.

Where do we start? I suggest you start by focusing on a particular activity where you can easily identify somewhere between 4-8 roles that are required for that activity. The Mapping tips above have some tips on scope, scale and boundaries and there are other tip sheets in the How To Guides at http://www.value-networks.com/ . They are designed to address FAQs such as this one. That said, I just want to share that at the beginning of a workshop in the Netherlands a clearly skeptical partipant asked, "I want to know where I would actually use something like this." At the end of the day he said, "I get it - you use it with whatever is on the table." You can use VNA at virtually every level from shop floor (example Mayo Clinic looking at how to reduce scheduling time for a procedure) to business unit level (exampel AT&T getting ready for a product launch) to business webs (the eBay value network) or at the macro economic level as we already mentioned. Youdo need to decide what level you want to look at - ground floor, rooftop, helicopter, jetliner or satellite and not mix your level. Doread the "how to guides," sit down with a couple of friendlies and try it out. It doesn't do any good to just read about it - just do it. One of our practitioners suggests that people start by simply mapping their own most important role and their everyday key interactions. There are also a number of case studies on the http://www.value-networks.com/ site that will give you a good sampling of how people are using it. The community goal for that site is to really give people an on-ramp to learn all the trade secrets to the method and provide enough tools and examples that they can get started. Hope this is helpful. I am glad you enjoyed the presentation and encourage you to jump in and get your feet wet. Like anything there is a learning curve but it can be a very fast track to some good results. An executive with Openwave came to one three hour workshop on VNA, went back home and completely reorganized a company of three thousand people over the next two months using the method. He said it was the smoothest reorg they ever had with zero productivity loss the entire time. There is a slide deck on that in the case studies tab on the resource site, too. I appreciate that you asked your questions in a forum as they really are FAQs and this gets the word out to more people on where to find the support. Oh, yes, I always forget to mention we do have a commercial "deep dive" ValueNet Works Practitioner Qualification for a fee. You can learn about that at http://www.alleevaluenetworks.com/ . You can tell I am a maniac on a mission because most of the time I forget to even mention the commercial offerings, but I have a cat (insert dog, child, partner) to feed just like everyone else. Our qualified practitioner community stretches literally from Iceland to Tasmania and lucky for you Peter there is a nice little "hotbed" of practitioners on the UK who are also very supportive of new folks.
Good luck.

Verna Allee
>>

I will get my feet wet now and try out VN. I particularly like the idea that VN can be used to bypass the culture issue by focusing on the value-adding interactions. Knowledge-sharing is a byproduct of the process, not the objective. Knowledge is the asset, added-value the output.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com/

“Knowledge management strategies that create value”

2007-04-09T23:04:00.000+01:00

I found a very good article with the same name as this post on the Accenture site. It was written in 1999 by Leigh P. Donoghue, Jeanne G. Harris and Bruce E. Weitzman.
(Accenture.com article) It presents a rather visionary KM approach considering it is now about 8 years old.

The article starts with this statement I totally agree with: “There is no one-size-fits-all way to effectively tap a firm's intellectual capital. To create value, companies must focus on how knowledge is used to build critical capabilities”. I would add that the more pervasive a Company’s organizational culture is, the more this is true. So many technological solutions have been presented as THE knowledge-sharing solution, and nearly as many have failed.

“[…] Knowledge management is complex and multifaceted; it encompasses everything the organization does to make knowledge available to the business, such as embedding key information in systems and processes, applying incentives to motivate employees and forging alliances to infuse the business with new knowledge. Effective knowledge management requires a combination of many organizational elements—technology, human resource practices, organizational structure and culture—in order to ensure that the right knowledge is brought to bear at the right time”. Well, this is what I (and many other KMers) have been writing for some time now. You cannot count on technology alone, or on a structural change alone, or on a new reward and recognition mechanism alone, to instigate a deep, long-lasting and effective leveraging of an Organization’s Knowledge. You need a holistic approach with both top-down leadership and bottom-up initiatives, being aware along the way that different core processes will require different KM solutions. The authors then present a framework created and used by the Accenture Institute for Strategic Change. Its aim is to associate “specific knowledge-management strategies with specific challenges that companies face”.

Well, my first impression of this framework presented this way was: whow! That looks simple (if not simplistic). I was reassured a bit when reading two paragraphs down that “[..]It is important to note that there are no hard-and-fast connections between a certain core process and a work model, because the same process can be performed in different ways”. In other words, you cannot actually plot core processes on the table above to build a model to fit all companies. This would also contradict the initial statement that there is no one-size-fit-all solution. So this is where the Accenture consultant comes in. The way the work is performed in the organization must be defined in order to select the right KM approach.

In the above diagram, the authors show how an Organization’s work processes can be aligned with a specific KM model.

I think this framework is approaching the issue in the correct manner, i.e. holistically and with a good deal of flexibility in order to adapt to any organizational context. However, there is a level of flexibility that I believe is missing. It could be that it was omitted by the authors in this rather short presentation. Nevertheless, I can only judge on what is given here. The flexibility that seems to be lacking is the consideration that within a specific work process, say Retail operations, you can be faced with a rather more complex context than what is assumed with the different diagrams given in this article. In the example above, the authors have assumed that Retail operations would be aligned to the Transactional Model. The authors define this model as the one “in which there is a low degree of both interdependence and complexity. Work is typically routine, highly reliant on formal rules, procedures and training, and depends on a workforce that exercises little discretion”.

Indeed, Retail relies on direct transactions with the end-customer. However, the definition above is valid in a mass-market context with low value, low margin, high quantity and relatively low product differentiation. Take instead the luxury market context (and I choose this example because I have 14 years of experience in it) with high value, high margin, low quantity and very high product differentiation. Within the Retail operations of a luxury products (and/or services) organization, you will find:

* A rather low degree of interdependence, so the Transaction model still fits for this dimension.

* There is relatively high degree of complexity. In the jewellery business for example, the expertise in gemmology of the sales-associate can represent the key added-value for the customer in search of a diamond necklace. Experience in how to satisfy very demanding and difficult customers is typically what can make a good sales-associate very good.

* Work is not “routine” to the same degree as in a mass market since each transactions can differ greatly due to the uniqueness of the product sold, the customer’s varying requirements and behaviours and the sales-associate varying level of expertise and experience.

* Work relies on formal rules and procedures but not exclusively. There is also a significant degree of informal relationships between sales-associates or between them and their customers, with whom they build strong relationships over time. Often, a sale is made as a result of this informality.

* Work does initially rely on training - especially for Brand and product knowledge as well as sale-techniques – but the best performers among sales-associates rely even more on their intuitions and experience.

* Work does depend on a workforce capable of making decision on their own, such as proactively contacting customers, deciding on which products to suggest to a customer, or offering/accepting a discount in a responsible manner.

The Expert model would therefore come to the rescue in this context but not as a replacement of the Transaction model. I am suggesting here that a combination of both models is needed to map a luxury business’ Retail operations. In this Retail context, there is still a degree of “routinization” and automation, and there is a definite “productization”. However, there is also a significant need for experienced hiring and capability protection. Capability/skill development is also a concern. (Apprenticeships used to be commonplace in luxury retail businesses some 20/30 years ago, but was replaced by a more individualistic and internal competition-oriented approach. I foresee that it will come back as a result of more knowledge-conscious management – read my earlier post on the subject: http://leveragingknowledge.blogspot.com/2007/03/knowledge-sharing-for-retail-manager.html).

Now what would such a mix of these two models mean in terms of practical solutions? The authors do not provide (for obvious reasons) the list of KM solutions they would implement for each model. However, I can guess one here.

The degree of “routinization” involved in luxury retail operations would demand solutions delivering just-in-time information (as opposed to just-in-case) to the sales staff. This could be in the form of a CRM tool providing a sales-associate specific information about an unfamiliar but regular customer sitting in front of him/her. It could provide the list of all the products the customer purchased so as to enable the sales-associate to suggest matching products among new or older collections. It could also have the anniversary dates such as the customer’s or his/her partner’s birthday, or their wedding date; for the sales-associate to wish him/her and suggest suitable gift ideas. All this customer-specific information is valuable but it can really create significant value when it is associated with context-sensitive information – in effect, offering expert knowledge. This is where our authors’ Expert model comes in: In the situation above, our sales-associate would benefit from the relevant knowledge of a more experienced colleague. More experienced here does not necessarily mean more seniority; it can mean better specific knowledge about the customer being served, or even about the customer’s cultural background. What is needed is therefore an apprenticeship-like solution associated (or better integrated) with the CRM tool. For example, the sales-associate could be informed that the customer is of Indian origin and Hindu, with the “warning” that between August and October, all Hindus purchase gifts (and in particular luxury products) to offer on Diwali (their annual “festival of lights”). The sales-associate could happily then suggest: “Oh Diwali is coming soon isn’t it? Please let me show you this brand new collection of jewellery that should look stunning when worn with a sari” (typical Indian dress).

I have here mixed the Expert and Transaction models but I am sure similar combinations will be needed in other contexts, sometimes involving 3 or even all 4 models. Graphically, this means to allow a work process to be plotted in the middle so as to overlap 2 or more models. The Process mapping diagram shown above seems to allow this (“customer service” work process overlaps the Integration and Transaction models) but it is not clear if it was really intentional (probably they worked it out themselves since then). In any case, it was a promising framework and I would love to learn of its implementation successes.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Dave Pollard's "KM quick wins" against my "organizational cultures not conducive to knowledge-sharing"

2007-03-31T17:33:00.000+01:00

Dave Pollard recently posted the following on his still amazing weblog: Knowledge Management: Finding Quick Wins and Long Term Value.
First, do read it. Then, consider the association I have made below between his list of quick wins and longer-term programs, and my list of cultural traits hindering knowledge-sharing (http://leveragingknowledge.blogspot.com/2007/03/organizational-cultures-not-conducive_20.html#links ):

Six 'Quick Win, Low Hanging Fruit' KM Projects.

1. Make it easy for your people to identify and connect with subject matter experts.
This deals with:
7. Lack of Awareness of internal knowledge.
And even maybe in a more medium-term with:
4. Organizational silos that do not (or poorly) communicate/collaborate.

2. Help people manage the content and organization of their desktop.
3. Help people identify and use the most appropriate communication tool.
4. Make it easy for people to publish their knowledge and subscribe to the information they want.
These three quick-wins help people be more efficient so could help with:
8. Lack of Availability of internal knowledge.
The quick-win no.4 also deals with the cultural traits 4 and 7 above.

5. Create a facility for just-in-time canvassing for information.
6. Teach people how to do research, not just search.
These last two quick-wins again deal with the same three traits above (nos 4, 7 and 8).

Six Longer-Term Big Payoff KM Programs.

a. Make your information professionals anthropologists.
This program will have a similar impact to most of the quick-win above. It will further help in making people more effective and efficient and at connecting with one another, so will help with:
7. Lack of Awareness of internal knowledge.
8. Lack of Availability of internal knowledge.
4. Organizational silos that do not (or poorly) communicate/collaborate.

b. Embed intelligence in systems, processes and tools.
I think the only trait this effectiveness/efficiency improvement program helps with is:
8. Lack of Availability of internal knowledge.

c. Teach your information professionals to be sense-making specialists.
This program focuses on the information professionals and for them will help with:
15. Modesty resulting from lack of encouragement.
11. Job Description framing.
8. Lack of Availability of internal knowledge.

d. Use knowledge to drive innovation.
With open-minded top-executives, this program could maybe help with:
16. Top-executives misunderstanding KM challenges.
If innovation is rewarded then this program would also indirectly help with:
3. Reward achievements of each individual based solely on personal objectives.
And it could also drive the insertion of "being innovative" through "collaboration/knowledge-sharing" in job definitions so helping with:
11. Job Description framing.

e. Canvass the wisdom of crowds.
This programs helps with the following traits:
8. Lack of Availability of internal knowledge.
1. A strictly hierarchical top-down structure.
13. Only money talks.

f. Collect, and attract people to use, stories and anecdotes.
At first, I thought this one would not relate to any of my traits but it does. This program would help making people feel more comfortable in sharing their knowledge; in fact, some would share knowledge without realizing how valuable it can be to others. Therefore this one helps with the following two traits:
14. Perfectionism resulting from fear of being wrong.
15. Modesty resulting from lack of encouragement.

I have managed to associate 10 of the 16 cultural traits to Dave’s 12 quick-wins and longer-term programs. It’s good and I would certainly agree that all these initiatives would move an organization, or more precisely some of its collaborators, in the right direction. However, the six “anti-knowledge-sharing” cultural traits left-out are significant in my view. Dave’s approach is based on the principles of Personal KM and, as I already wrote (http://leveragingknowledge.blogspot.com/2006/11/personal-knowledge-management.html#links) I do not believe you can sufficiently change an organizational culture with only a bottom-up approach. The only initiative in Dave’s list that attempts to initiate a top-down change is the program (d) about using knowledge to drive innovation. I did loosely associate it to the trait relating to top-executives misunderstanding KM. This is because within a culture not conducive to knowledge-sharing, you will need more than that to have your top-executives truly understand and support KM. You could be told: “We are innovative already and we must be using knowledge in the process, so we’re fine, no need of KM”.

Using Dave’s quick-wins and some of his programs can surely help drawing the attention of top-executives. With a few influential sponsors on-board, you could then hope to tackle all the non-conducive cultural traits including the other six such as 5. Lack of trust, 6. Internal politics, 9. Too much pride or 2. Reward achievements of each individual based solely on personal objectives. So PKM will help but will not succeed on its’ own if the goal is a deep and lasting cultural change.

Peter-Anthony Glick

http://leveragingknowledge.blogspot.com

Content of my site

2007-03-25T12:18:00.000+01:00

Dear readers, I have created a list of all the blogs posted on this site, sorted by theme:
http://leveragingknowledgelist.blogspot.com

Peter

Knowledge-sharing for a Retail Manager

2007-03-21T17:29:00.000Z

In a retail company, who is at the centre of value generation? Undoubtedly the person making the sale: the sales associate (I am talking about markets relying on differentiation, not cost advantages). You would then expect these organizations to focus on facilitating each of these key value generators in generating more and more value.

Yesterday, I had a very interesting conversation with a retail boutique (store) Manager. She started on the issue of retention (or the lack of) of knowledge when an experienced member of her team leaves the company. It’s not only that no set formal hand-over process exist, it is more about the lack of a knowledge-transfer process well before an individual decides (or is made to) to leave.

I told her that this issue is still encountered by most managers in most organizations (not many executive Boards have given much thought on this HR issue yet). In her case, this lack of knowledge sharing resulted in the loss of valuable customer relationships knowledge and contextual selling experience (selling effectively specific types of product to a particular customer group, in a specific geographical location, her boutique).

Our discussion then went on about another aspect of knowledge sharing needs for her team and the retail department. She was concerned that - due to a 6-day rota giving
a day off in the week to compensate for a Saturday duty - too often one member of her team misses her weekly review meeting. She then has to remember to whom she has to repeat some important information. We both agreed the solution would be an online intranet where meeting summaries and other departmental information could be posted for all sales-associates to read.

Not rocket science you might say (indeed many organisations provide such tools) but most Knowledge leveraging solutions do not have to be technically complex at all in order to deliver noticeable benefits. In the context of this retail Manager, this simple intranet would be the solution. She then realised that this shared tool could also be used by sales-associates from different boutiques to exchange experiences, ask each other questions, debate on some common topics. Such interaction between sales teams is needed to learn from each other.

In differentiation-focused markets, internal competition is entertained between sales-associates, between sales teams, between distribution subsidiaries and this even for the same Brand. This is fine and usually generates value. However, the fine line not to cross is that this competition should not be at the expense of the customer, and therefore at the expense of the company’s overall performance and the Brand’s image. Internal competition is typically a key reason for lack of knowledge sharing within a sales force.

What are the potential costs of an experienced sales-associate leaving the company without a formalized and extensive transfer of his/her specific & valuable knowledge? Some of his/her best “loyal” customers will automatically follow him/her to the competition. Other customers might notice a significant difference in the service they receive from his/her colleagues and decide to at best, go to another sales team within the same company, or at worse, finally go to the competition. We could also face a drop in turnover on subsequent sales made to some of his/her usual customers remaining loyal to the Brand. This is because their usual sales-associate would have better known how to satisfy these customers and often entice them into buying more as a result.

What are the potential costs of sales-associates not informed on time or misinformed? This is now related to the other knowledge-sharing issue the retail manager told me about. The possible consequences of sales-associates not informed properly are numerous. Some examples are: Not knowing about the arrival of a VIP, not knowing of the arrival in stock of a new collection, not knowing of an important security concern, or not knowing about a local event that should draw more traffic in the shop.

I have already identified above a relatively simple and “cheap” solution to this problem. What about a solution to the “lack of knowledge-transfer between sales-associates” problem?

An idea is that managers could establish “mentor/apprentice” relationships between pairs of sales-associates. The mentors’ performance (and recognition, and reward) would be dependant on their apprentice’s achievements nearly as much as on their own. In this way, the experienced sales-associate is encouraged to share his/her knowledge and customers with a “junior” sales-associate, so that if he leaves the company, there is a natural and effective hand-over. Other operational benefits can be identified such as the apprentice “covering” for the mentor when the latter is away (day off, holidays, sick leave, etc…). The mentor benefits by having his/her apprentice handling the sales for his/her customers during that time. The apprentice benefits by “holding the fort” and being put to the test. The company benefits:

· By maximizing the chances to satisfy the mentor’s customers in his absence, therefore offering continuity in level of service.
· By speeding up the learning of junior staff, therefore resulting in a more experienced sales-force overall.
· By increasing revenue at relatively low cost, therefore increasing profits as well.

In other words, a win/win solution.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Organizational cultures not conducive to effective leveraging of knowledge (updated)

2007-03-20T21:27:00.001Z

I have added 6 cultural traits to the initial list. This list is probably still not exhaustive so anyone spotting a missing factor hindering knowledge sharing, please post a comment with your suggestion.

1. A strictly hierarchical top-down structure: The “you should not share knowledge outside your department without your manager’s approval” syndrome.

2. Focus on short-term objectives: the “no need to share knowledge since once objectives are met, it wont be needed anymore” syndrome.

3. Reward achievements of each individual based solely on personal objectives: the “you are judged on what you achieved, not on what others have achieved with your help” syndrome.

4. Organizational silos that do not (or poorly) communicate/collaborate: the “we cannot possibly need help from anyone outside our very experienced and specialized group” syndrome.

5. Lack of trust: the “why should I take the risk to help whom I compete with, I wouldn’t get the recognition for it anyway” syndrome.

6. Internal politics: “Knowledge is Power so I retain it” syndrome.

7. Lack of Awareness of internal knowledge: The “I do not expect anyone in the company to have the experience/skills I need” syndrome.

8. Lack of Availability of internal knowledge: The “others probably could benefit from my experience but I’m too busy to check, let alone actually help” syndrome.

9. Too much Pride: The now too famous "not invented here" syndrome.

10. The confidentiality issue: The “we fear that some vital competitive knowledge can get into the wrong hands, so the least we share it, the smaller the risk” syndrome.

11. Job Description framing: The 'No-one's paying us to have a wider vision' syndrome.

12. Groupthink effect: The 'We'll define our stakeholders as the people we already know' syndrome.

13. Only money talks: The 'those so-called stakeholders aren't actually funding anything directly, so they're not real customers' syndrome.

14. Perfectionism resulting from fear of being wrong: the "I won't share until I'm certain it's perfect" syndrome.

15. Modesty resulting from lack of encouragement: the "who am I to teach others, of course they know" syndrome.

16. Top-executives misunderstanding KM challenges: The "this knowledge sharing sounds great! Can you order everyone to do it tomorrow please?" syndrome!!!

You can test your organization against these 16 cultural traits. The more of them fits your workplace, the more of a challenge you will have to promote knowledge sharing. Some are more difficult to deal with such as internal politics, but I would conjecture that you will need to address all the relevant traits at some point in the process. They all have their importance and only one of them - deep rooted in the organizational culture - can jeopardize leveraging knowledge efforts.
I have recently (Feb. 08) added 4 more traits, check this post.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com/

Organizational cultures not conducive to effective leveraging of knowledge (cont.2)

2007-03-10T16:35:00.000Z

In his comments, Jean Pommier (ILOG) suggested the following two cultural traits (which I have adapted a bit):

14. Perfectionism resulting from fear of being wrong: the "I won't share until I'm certain it's perfect" syndrome.

15. Modesty resulting from lack of encouragement: the "who am I to teach others, of course they know" syndrome.

Peter
http://leveragingknowledge.blogspot.com

Organizational cultures not conducive to effective leveraging of knowledge (cont.)

2007-03-08T23:27:00.000Z

Courtesy Hilary Burrage (http://www.hilaryburrage.com/ ) I have 3 additional cultural traits to suggest:

11. Job Description framing: The 'No-one's paying us to have a wider vision' syndrome.

The next two are more relevant to the public sector:

12. Groupthink effect: The 'We'll define our stakeholders as the people we already know' syndrome.

13. Only money talks: The 'those so-called stakeholders aren't actually funding anything directly, so they're not real customers' syndrome.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Organizational cultures not conducive to effective leveraging of knowledge.

2007-03-05T22:18:00.000Z

The list of 10 “syndromes” listed below is not exhaustive so anyone spotting a missing factor hindering knowledge sharing, please post a comment with your suggestion.

1. A strictly hierarchical top-down structure: The “you should not share knowledge outside your department without your manager’s approval” syndrome.

2. Focus on short-term objectives: the “no need to share knowledge since once objectives are met, it wont be needed anymore” syndrome.

3. Reward achievements of each individual based solely on personal objectives: the “you are judged on what you achieved, not on what others have achieved with your help” syndrome.

4. Organisational silos that do not (or poorly) communicate/collaborate: the “we cannot possibly need help from anyone outside our very experienced and specialized group” syndrome.

5. Lack of trust: the “why should I take the risk to help whom I compete with, I wouldn’t get the recognition for it anyway” syndrome.

6. Internal politics: “Knowledge is Power so I retain it” syndrome.

7. Lack of Awareness of internal knowledge: The “I do not expect anyone in the company to have the experience/skills I need” syndrome.

8. Lack of Availability of internal knowledge: The “others probably could benefit from my experience but I’m too busy to check, let alone actually help” syndrome.

9. Too much Pride: The now too famous "not invented here" syndrome.

10. The confidentiality issue: The “we fear that some vital competitive knowledge can get into the wrong hands, so the least we share it, the smaller the risk” syndrome.

You can test your organization against these 10 cultural traits. The more of them fits your workplace, the more of a challenge you will have to promote knowledge sharing. Some are more difficult to deal with such as internal politics, but I would conjecture that you will need to address all the relevant traits at some point in the process. They all have their importance and only one of them - deep rooted in the organizational culture - can jeopardize leveraging knowledge efforts.

Check my updated list with 6 more syndromes:
http://leveragingknowledge.blogspot.com/2007/03/organizational-cultures-not-conducive_20.html#links

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

will Web 2.0 social tools have a major transformational positive impact in the workplace?

2007-02-22T14:40:00.000Z

Yesterday, I attended in London a David Gurteen’s Knowledge Café with the topic of the Web 2.0 social tools and what they will mean for organizations.

The question to answer was: will these tools have a major transformational positive impact in the workplace?

This K Café had an unusual format this time, starting with two speakers given 10mn to either answer positively or negatively. Then the 50+ attendance divided in groups of 5 to discuss/debate, followed with a speaker for each group addressing everyone with the conclusions reached by their group. The event ended with an informal vote on the question.

Let’s start with the result of the vote: about 35 people chose to answer positively. It’s a majority but that still left 15 to 20 people (so about 1/3) either unsure, or believing that these new social tools will either have a negative impact or no significant impact at all. I felt that was still quite a lot.

Being a supporter of any tools that can help to foster knowledge-sharing and innovation, I will focus here on the arguments given against them having a large impact.

A key “negative” argument mentioned was that these social tools are over-hyped since the bulk of effective conversation can only be spoken, not written. Face-to-face conversation would always be required.

I would agree with the over-hyped status but not for this reason. The Web 2.0 social tools are not designed to replace face-to-face conversation at all! They are to enable conversations and knowledge sharing that would for the most part otherwise simply not take place. You don’t start a blog and join online forums to discuss with your neighbors and the colleagues you see every day. Yes they might also take part but you intend to reach many many more people you will never speak to directly, let alone meet face-to-face.

The reason these tools are over-hyped is that the issue is not about the technology but about the people and the organizational culture. As it was correctly highlighted yesterday, these tools are to be used for a purpose that make business sense to the people using then and to the organization they work in. In other words, they must contribute directly or indirectly to the bottom line: higher profits (or value for money in the public sector).

Another “negative” argument I noted was the fear of information overload. More collaborative tools meant for many the risk of increasingly less control over the amount of incoming information. I believe this risk is real but so it was with the telephone a century ago, with email 15 yrs ago or with mobile phones 10 yrs ago. It didn’t stop our ancestors to install a phone in their home or for us to now receive emails on ou mobile phone(s)! It is a potential problem yes but not one that would prevent the Web 2.0 social tools from flourishing. This fear will influence more how we use them individually or collectively such as within an organization.

On the whole, the majority agreed that the spread of Web 2.0 tools inside the organization was inevitable. It was only a matter of time. What was less clear was what would be their true benefits, what transformation they would generate. What is happening on the public web can give us some clues but it is indeed difficult to foresee exactly their impact on the workplace. Nevertheless, this is not a reason for not starting to use them, maybe just one to be cautious and not move too fast. But that’s ok, that was also the case with email back in the 90’s.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

“Break the Mould”

2007-02-16T12:45:00.000Z

Check out this useful article in a Computing Business issue: http://www.computingbusiness.co.uk/computing-business/features/2169316/break-mould .
I agree with most of what it says but I would like to highlight the following extracts:

‘Stop benchmarking the competition,’ says John Riker at the Value Innovation Network. ‘Instead, pursue a quantum leap in value to dominate the market.’ […]

‘To create a quantum leap in value, companies need to direct all their talent to explore the market. The key to this process is to open up the entire organisation to seek growth opportunities. Most firms sit on a gold mine of talented and capable people, yet few tap into them in developing strategy. By bringing together a diverse team of employees from across functions, levels and geographies, an organisation can foster new ways of thinking and a wider business perspective,’ says Riker.

Now the only efficient way you can direct all an organisation’s talents to any task such as exploring the market for opportunities, is by implementing a corporate culture, internal processes and an infrastructure compatible with knowledge-sharing. Collaborators will actively participate only if:

· They feel safe in spending time on such task (instead of focusing only on their job description). In fact, they should be encouraged by their line manager.

· They are formally recognized and rewarded when producing good ideas.

· They have access to tools facilitating collaboration and sharing of experience/knowledge (this enables cross-functional team efforts and helps to prevent duplication of efforts).

“Strategy formulation must consider both a company’s traditional market, and all alternative markets. Until you expand your definition of your market you will not be able to expand the possibilities of your offer.”[…]

‘Through a qualitative process of market exploration, companies can begin to look at their industry and business through a new set of lenses. They learn about their customers’ dreams and hates, their aspirations and irritations. This rich image of the wider market translates into breakthrough ideas for new market space,’ he says.

Re-inventing the wheel.

‘It requires immense leadership and courage to abandon the ritual comfort of traditional strategy development and embark on this process,’ says Riker. ‘But given the unrelenting pressure of competition, the need to introduce unconventional thinking will become imperative for all firms seeking to create successful growth strategies.

In developing an innovative strategy, it is worth looking externally and reviewing competitors’ ideas. Each year, millions of pounds are wasted on research into technologies that has already been disclosed.

There is a multitude of intellectual property being generated internationally, according to
technology broker John Allies, most of which is never used and most of which is relatively easy to gain access to, provided you know where to look and who to talk to. ‘If you are looking for a solution, why pour money into research when someone might already have cracked the problem?’ he asks. >>

Yes, yes and yes! Even more so when that “someone” is likely to be a colleague of yours somewhere in your organization!

It is really amazing how much all these arguments that sound so common sense are still not considered in most organizations. For the right individual(s) with the right knowledge to be involved at the right time for a particular issue/project/idea, what is first required is an organizational culture encouraging knowledge sharing. It is not a problem of technology since collaboration tools exist in the many now, and some are even virtually free.

In fact, even without specific knowledge-sharing tools, it is still possible (but time-consuming) to find a colleague with appropriate knowledge using “standard” tools such as organizational charts, corporate intranets and address books, and projects documentation. However, too often you don’t even bother searching. Why? Because you work in an organization where it is not natural to ask for such ad-hoc cross-hierarchical/cross-departmental/cross-border assistance. Even if you find someone willing to transfer his/her knowledge, he/she will probably feel the need to request management permission to invest time on your request. This would then immediately formalize and complicate a process that should really remain casual, flexible and simple: sharing knowledge and experience.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Knowledge-driven, not simply customer-driven.

2007-01-25T12:07:00.000Z

There are numerous hurdles/blocks for converting an organization to become “knowledge-driven”; but if we look at the fundamentals for commercial success, we see that it is the right way to go to efficiently leverage organizational resources (mostly the human part) and sustain competitive advantage through creativity and innovation.

Firstly, some of you might be thinking: surely “customer-driven” is the way to go, knowledge being “only” a mean to an end. There is some truth in this view. Indeed the customer’s satisfaction is often considered as the ultimate objective for all corporate projects and operational activities. It is also correct that organizational knowledge is to be used to facilitate this endeavour.
However, is satisfying the customers really the drive for share-holders? No, they are driven by increased market share, increased profits and revenue and increased growth potential/forecast.

Now, you might say: hold on, if you don’t satisfy your customers you wont get these increases! Yes and No.
Firstly, this view actually supports my first point: that a satisfied customer is a mean to an end, not the end of the means (if I can put it this way).
Furthermore, being customer-driven often leads to a short-term view: it is about “pleasing them enough to enable us to make our sales target for the month [or the year]”. The long-term repeat business isn’t necessarily cared for.

For long-term competitive advantage and growth, what is instead needed is to view the customers not “simply” as purchasers of goods and services but as “collaborators”. The customer participates (directly or indirectly) in as many stages of the product cycle as possible. The idea is to build a long-term partnership between the organization and its customers. The message to the customer becomes “we are partners/collaborators in this on-going endeavour to please you while at the same time growing our business”.

This approach aims at more than satisfying the customer, therefore at delivering above his/her expectations. To achieve this, the organization needs to know well its customers (who they are, their cultural/social background, what they like/want, where/how they live, where/how they travel, etc…). Similarly (and this is where it gets really interesting) the customer needs to know well the organization (its products/services – past, present and future; its mission/goals; its history; its point of sales network – incl. of course its website; its successes and - yes why not – its failures; and lastly but certainly not least, its people).

Knowledge is then at the centre of this collaborative relationship, hence the knowledge-driven approach.

Now, before enabling your customers to “know” your organization well, the organization must first know itself well. An organizational culture valuing knowledge-sharing is needed.
Then, in order to sustain such a collaborative relationship with your customers, your organization will require continuous innovation, and not just in the product design department! Innovation must be encouraged in all functions. Everyone without exception can be creative/innovative. Innovation is fuelled by sharing knowledge/experience and by effective collaboration across departments and borders.

This is where Knowledge Leveraging (or the so-called Knowledge Management) comes in...

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

I am Time Magazine's “Person of the Year” (*) !

2006-12-18T12:16:00.000Z

(*) As millions of other web 2.0 enthusiasts.

Yes, Time Magazine chose all the bloggers, the wikis’users, the online Forum members and other Web-based collaborators as their Person of the Year 2006 (http://www.time.com/time/magazine/article/
0,9171,1569514,00.html?aid=434&from=o&amp;to=http%3A//www.time.com/time/magazine/article/
0%2C9171%2C1569514%2C00.html ).
This is a fantastic recognition of this exponentially growing movement unleashing a power for the individual equalling that of political leaders!
This power relies on a core principle: a Worldwide reach.

I particularly love the conclusion of the article:

“Web 2.0 is a massive social experiment, and like any experiment worth trying, it could fail. There's no road map for how an organism that's not a bacterium lives and works together on this planet in numbers in excess of 6 billion. But 2006 gave us some ideas. This is an opportunity to build a new kind of international understanding, not politician to politician, great man to great man, but citizen to citizen, person to person. It's a chance for people to look at a computer screen and really, genuinely wonder who's out there looking back at them. Go on. Tell us you're not just a little bit curious.”

My question now is what should this mean for Organizations? The answer must depend on what aspect of the Organization we are considering: internal or external.

Externally, this “new kind of international understanding” will mean new ways for Organizations to reach their customers. However, not simply to communicate but to collaborate with them. Customers will increasingly expect and value being involved throughout the product life cycle, from the idea generation to the after-sales services.

Internally, Organizations will need to quickly realise that many of their collaborators are also “Person of the Year”. They will expect similar collaborative facilities within the Organization to the ones they use at home. Of course, internally you need a higher degree of control than on the Web for security and confidentiality, with user access rights to sensitive information. However, it is also clear that efficiently and effectively connecting all the brains working in an Organization can generate value. How many of us have experienced the annoying realization that a collaborator had the answer to a problem that at the time required external help, simply because you had no easy way of finding the answer internally (in other words, reinventing the wheel).

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

The virtuous cycle of the Gift Economy

2006-12-08T13:43:00.000Z

«Everyone thinks of changing the world,
but no one thinks of changing himself.»

Leo Tolstoy (1828 - 1910)

You all must read Dave Pollard’s latest post “The virtuous cycle of the Gift Economy” (http://blogs.salon.com/0002007/2006/12/06.html#a1718 ). It did make me realise that I already intuitively knew this but it just needed to rise from my sub-conscience. It did!

This virtuous cycle looks great but I believe that a more realistic state would be somewhere in between the Capitalist and the Gift Economies. These two as defined in Dave’s diagram are extremes and as such should be avoided. Our current world tends to gravitate closer to the capitalist end of the spectrum so we need to collectively push in the other direction. However, I don’t see the World moving all the way to a “complete” Gift Economy. I am not sure that it would be such a great World to leave in anyway. If all hierarchies were to disappear and everyone would share most of what they need/want and purchase only what they need and cannot obtain in any other way, some would quickly seize opportunities for taking advantages and build monopolies by controlling the production of what must be purchased.

Another potential flaw of the extreme Gift Economy model is the relative loose definition of an individual’s “needs”. What is seen as non-essential for some will be seen as essential for others. This is already the case in our mostly capitalist economy of course, but it is regulated by each individual’s purchasing power. I cannot afford a large home with a swimming pool therefore it wont even appear in my list of short-term needs, but I can still work towards it because I would love to swim every morning. In a Gift Economy, you could ideally imagine that I would team up with 10 neighbours and finance our shared swimming pool (or better build it ourselves!). Two problems: 1) not exactly the same level of privacy and convenience; and 2) I might struggle to find the necessary number of neighbours with the same “need”. Therefore, I might find myself force to still work enough to be able to afford my pool. Now, if you assume that most people will face a similar issue for a specific need within the communities (virtual or not) they are part of, wouldn’t we end up with a capitalist-like spiral again?

Having said that, we should still steer the Economy away from the all-encompassing Capitalism.

How can each one of us contribute to this effort? By “simply” doing more things ourselves (I will start by sorting out this annoying faulty living-room light switch myself). It also means engaging in more value-adding social networks. Two other recent blogs from Dave illustrates what this mean.
First, a social network diagram: http://blogs.salon.com/0002007/2006/12/01.html
Then a list of examples of SNAs (social networking applications) sorted by function:
http://blogs.salon.com/0002007/2006/12/05.html

I will use more of these tools myself and will promote their use around me and see what happens.

Peter-Anthony Glick

http://leveragingknowledge.blogspot.com

Personal Knowledge Management

2006-11-30T19:17:00.000Z

Yesterday, I attended a Knowledge Café in London arranged by David Gurteen (http://www.gurteen.com/gurteen/gurteen.nsf/id/kcafe-pollard ). The guest key-note speaker was Dave Pollard (http://blogs.salon.com/0002007/2006/09/27.html#a1657 ) and the topic: Personal Knowledge Management (PKM).

Very simply put, PKM differentiates itself from “classic” KM as follows:
KM => PKM
Collection => Connection
Content => Context

PKM states that we should instigate better knowledge sharing with a bottom-up approach rather than the more classic KM top-down implementations. The basic idea is to send Information Professionals (IP) on “the field” to help/teach individuals with one-on-one sessions to be more knowledge efficient and effective. The IP would also in the process gather a lot of useful information about what technology employees really need to do their job better and to add more value.

Of course, one-on-one sessions with everyone in an organization can be prohibitively expensive and time-consuming. Dave Pollard says that there can be ways to do this “economically” but the key is to convince top-executives that the increased efficiency and effectiveness more than cover for the costs. I believe this is indeed the main challenge of PKM. In fact, for a KM Professional, PKM does not resolve the key problem: getting board-level support to invest in knowledge leveraging initiatives. It might even make matters worse by not relying on an idealistic target state. It is harder to justify a multitude of “fuzzier” individualized initiatives (bottom-up) rather than a few collective ones with clear objectives (top-down).

I do see a lot of benefits with PKM but I would intuitively believe that in many organizations, a more appropriate approach would be a mixture of “classic” KM and PKM. The latter implemented to support and sustain the initiatives of the former. I really do not see PKM succeeding on its own in an organization where knowledge-sharing is not part of the culture. I don’t see it as the magic bullet in such a context.

One issue we chose to address at my table during this event was the fear that top-management usually has with wide-spread relatively uncontrolled knowledge sharing: the risk of some very valuable information falling into the wrong hands. A very pertinent approach was suggested to me: we first need to define exactly what type of knowledge is critically valuable to the organization, what makes it really competitively different. It is then this knowledge that would be kept secure. The rest can be left to be shared to add value and foster creativity and innovation. I am not saying this would be easy but it does make a lot of sense.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

ROI or no ROI for KM?

2006-10-27T09:05:00.000+01:00

I recently submitted a question to a KM mailing group about ROI. I basically wanted to obtain practical examples of KM initiatives (preferably company-wide) that have shown clear ROI in money terms.

The discussion rapidly evolved into argumentations between the ones convinced that using the old-fashioned ROI method for justifying initiatives in the world of intangibles is complete non-sense and potentially counter-productive; and the ones that believe that ROI still has an important role to play, if not for anything else, for obtaining the support of “old-fashioned” top-management.

At the time I asked my question, I was of course targeting the second group. The most virulent supporter of the “ROI is useless” view went to claim that network analysis and in particular Value Networks was the only way to go, citing Verna Allee as a leading thinker in the field. I then thought I should in fact ask her directly and via email, here is Verna’s response:

"Any major corporate investment should be able to demonstrate some kind of positive impact in either financial or non-financial terms or you need to rethink what you are doing. However, for many knowledge focused initiatives the really big story is in building strategic capability for the future - which is all about intangibles- and is not about classic ROI. Of course ROI can include non-financial returns and impacts but people do not have that understanding so I generallly avoid using the term. People need to know how to tell both kinds of stories and know when to tell them. KM practitioners have completely dropped the ball in learning the language of intangible value then they wonder why they have so much trouble getting support for their efforts. Of course a lot of managers don't think this way but if the KM people just feed into their old way of thinking they are doomed for frustration. Step up to the plate and learn to the story of value in intangible terms. If you aren't educating your leaders to this way of thinking - who will?" Verna Allee.

My reply to Verna was:
Yes Verna, that is exactly the problem for most KM practitioners (at least it is for me): we know that we should do away with old methods but we don't believe our leaders can understand our new language without some transition using their language in a new context.
Probably we underestimate them and should be more courageous.

I recommend Kaye Vivian's blog entry on this topic:
http://dove-lane.com/index.php/2006/10/17/km-and-myth-of-roi/

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

What if we tried to foresee what will follow the currently unfolding Knowledge Economy?

2006-08-29T11:18:00.000+01:00

What if we tried to foresee what will follow the currently unfolding Knowledge Economy? What will be the new buzz word for corporate leaders in 2050?I will not attempt here to answer these questions directly but will use scientific predictions as metaphors to give us a hint.

While reading recently the very interesting scientific book “The Next Fifty Years – Science in The First Half of the Twenty-First Century”, a collection of 25 new essays by leading scientists edited by J. Brockman (A Vintage Original, New-York, 2002) I found three passages from three different authors that are relevant to my two questions above.

First, here is how Alison Gopnik (professor of psychology at the University of California at Berkeley) ends her essay “What Children Will Teach Scientists”:
“[…] At the end of the last century, knowledge began to become the most valuable currency, like land in a feudal economy or capital in an industrial economy. The new science of learning should tell us that knowledge is not just a prize to be won in some desperate test-taking struggle for places in the contemporary mandarinate. Instead it is, literally and not just rhetorically, our universal human birthright.”

The way I read this (based also on the reading of Alison’s whole essay about the science to understand learning) is that our societies will progressively realise that knowledge is what makes us, humans, so special. The value of knowledge would then take the forefront in all aspects of our everyday life. We would continuously seek better ways to acquire it, to retain it, to share it, to nurture it. Of course, this should have a profound impact on management and organizational cultures. By 2050, the fact that knowledge is a vital asset will be a given fact and competitive advantage will be won by those who will leverage it faster and more effectively. This should mean that organizations of this future will have as a constant priority to make all their collaborators as creative and innovative as possible. Everyone in an organization will be empowered and encouraged to create/innovate making some mistakes along the way but learning a great deal more. This seems to be compatible with the next extract below.

Mihaly Csikszentmihalyi - a Hungarian-born polymath, formerly chairman of the Psychology Department at the University of Chicago and currently Davidson Professor of Management at the Claremont Graduate University in Claremont, California – writes in his essay “The Future of Happiness”:
“[…] Among the things we learned is that people who are engaged in challenging activities with clear goals tend to be happiest than those who lead relaxing, pleasurable lives. The less one works just for oneself, the larger the scope of one’s relationships and commitments, the happier a person is likely to be. […]”

Mihaly sees that by 2050, societies at large but employers in particular will have understood that people are more productive when they are happier, and that people are happier if they have challenging objectives and if these objectives are clearly contributing to the corporate goals. This seem to suppose that individuals will be valued for their specific knowledge and competencies to go beyond what is initially expected of them, in order to create value for the organization.

This nicely leads us to the third extract of this book I believe relevant to the leveraging of Knowledge. I found it at the end of Brian Goodwin’s essay titled “In The Shadow of Culture” where he attempts to explain why he believes a “science of qualities” is developing, where feelings and qualities have at least as much importance as proofs and quantities. Brian (a professor of biology at Schumacher College, Darlington, UK - where he coordinates a master’s program in holistic science- and a member of the Santa Fe Institute) writes:
“[…] In the shadow of current science it is possible to see the components of a science of qualities which would restore qualitative evaluation to the place it occupies in our everyday lives, where judgments depend on quality as well as quantity. This restoration, together with the recognition that feelings belong not only to us but also to the rest of nature, in whatever form, presents us with a dramatically transformed set of possibilities for scientific knowledge, technology, and corporate and political action.
A shift in scientific perspective of this magnitude is not going to happen overnight, if it happens at all. It requires new forms of education at a basic level, in which the sciences and the arts are united to keep people whole and in which scientific and technological decision-making require participation by all members of civil society, with knowledge joined again to responsible action.”

This extract is heavy in meanings and could open up many philosophical debates. I will only say this: if science does indeed go through such a drastic shift towards valuing qualitative judgment, it will have an even bigger impact on other parts of society such as the business world. Accounting would no longer rely on quantitative analysis and the value of a company would give at least as much importance to qualitative aspects such as its intellectual property, including the specific knowledge of all its collaborators.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Traditional strategies to improve efficiency are failing in the Knowledge Economy.

2006-06-22T17:56:00.000+01:00

It is really amazing and sad (and frustrating for some of us who can see the light) how much Company Boards concerned with cutting costs while sustaining growth can repetitively miss the most effective way to do this in the Knowledge Economy we leave in: leveraging the organizational Knowledge through the development of a knowledge-sharing culture to foster creativity and innovation.

Traditional means of cost cutting are increasingly reaching their limits and sometimes even become counter-productive. For instance, the still somewhat popular engineering tools designed to map, understand and control organizational processes – to eventually simplify/standardise them to cut costs and improve efficiency - are all failing to meet their objectives. They at best provide a partial understanding of what is really going on, and at worse end up being themselves more complex and costly to manage than what they are supposed to represent. The key problem of these tools is that they miss a vital part of organizational processes: the human aspects (social, political, hierarchical, geographical, knowledge, skills, competences, etc…).

Another example of a management tool usually not adapted to the Knowledge Economy is MBO or Management By Objectives. When managers’ performance is evaluated solely on annual objectives, they will naturally tend to focus their attention and efforts on these objectives and not be concerned with anyone else’s. In other words, MBO can have adverse effects on collaboration. Of course, there are ways to alleviate this problem such as including a knowledge-related objective for each manager. Assuming it is measurable, this objective would however probably drive the only knowledge-related activity a manager will carry out effectively, so not vey productive from a KM point of view.

Cost-cutting is still too often synonymous of redundancies, recruitment freeze, modest salary increase, low (or no) bonuses, etc… Of course, who is making the most sacrifices and suffers the most: the workforce (the human capital). The problem with this is that it affects negatively what is increasingly the most important asset to an organization: its people knowledge and experience. Instead of sending the message that their very existence is a reason for lower margins, they should be asked and given the suitable environment to actively and creatively work out ways to cut costs and/or increase efficiency/effectiveness with same resources. A suitable environment means enabling a knowledge sharing culture.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Business Intelligence for simulating the future

2006-06-02T17:21:00.000+01:00

Chris Caren (Microsoft’s general manager of Office business applications) had recently this to say about Business Intelligence:

The latest three trends are:

1. BI products are usually considered as too hard for everyone to use and too expensive to roll out to as many people as one would want to.

2. Standardising onto one or two BI product lines that can serve all the needs of different types of user.

3. A change in the way people are thinking about BI: from a report-centric, historical view of the business, to a metrics-centric view – involving dash-boards and scorecards – of where the company is heading.

I believe these three points are all valid and important but the last one is the key to success. The first two are more about technology, the last one is first about a change of approach and a change of objectives. It implies the realization that successful organizations will be the ones that focus on simulating the possible future rather than analysing the past.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Seven lessons learned with Knowledge Management initiatives

2006-05-18T17:15:00.000+01:00

If a shared information repository contains mostly information that people are used to find elsewhere, you’re wasting your time, it won’t be used.

“[...] make sure the system is easy and comfortable to use – in fact, easier and more comfortable than ignoring the system.” R. Buckman

For an individual (or a group) to contribute information, he/she must expect and obtain at least as much in return.

A deep cultural change in the organization can only succeed with a top-down approach.

Start small with “quick wins” and build on their growing reputation.

Pilot each new solution with welcoming teams and individuals. Keep the most resistant groups for last, they’ll follow when every one else is on board.

The “correct” level of information categorization depends on the tool, on the purpose and on the intended user community: Too much categorization adds unnecessary complexity and stifles creativity; too little leads to unproductive chaos.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

2006-04-03T17:07:00.000+01:00

Consider the above “Strategic Capability” diagram (L. Baird and J. Henderson, The Knowledge Engine, Berrett-Koehler Publishers, 2001, first edition page 14).

Business Intelligence (BI) needs to provide the right Knowledge to drive the strategy and use the strategy to direct Knowledge Management (KM) initiatives: The Focus stage above.
The BI Reflect stage must rely heavily on Knowledge generated at the operational level (this same Knowledge is considered as “only” Information at the Strategic Level). Reflecting is about aggregating and simplifying this “operational Knowledge”, making sense of it strategically to produce “strategic Knowledge”.

“Making sense of Information” means here to be able to use it in various pre-defined contexts and run simulations. These simulations are to assist the strategic decision-makers in assessing which strategies have the most suitable potential-to-risk ratio.

How should the operational Knowledge be structured to enable these strategic simulations?

I have been recently introduced by Dennis Sherwood (author of “Seeing the Forest for the Trees – A Manager’s Guide to Systems Thinking”, Nicholas Brealy Publishing, 2002) to Systems Thinking in the organizational context. I strongly recommend Dennis’ book but in a few words, “the essence Systems Thinking is that the complexity of the real world can best be tamed by seeing things in the round, as a whole. […] Taking a broad view, however, is not at the expense of missing the detail […]. Nor is it a question of broad brush versus detail; rather, it is one of taking a broad view in the context of the right detail, of truly […] seeing the forest for the trees.”

The idea here is then to illustrate operational Knowledge in a systemic form (a causal loop more precisely) where all stakeholders are linked up through a network of inputs and outputs. These ins and outs are to represent the influences these stakeholders have on each other. Influences are either positive or negative (never neutral).

These systems include levers and outcomes. The levers are the variables for defining an initial context for the simulation. The outcomes give the results of the simulation.

Various off-the-shelves software will enable you to relatively easily design such an organizational system. However, the complexity isn’t with the technical design but rather with defining the relationships between stakeholders, or in other words, with having a clear understanding of how the organization operates.

Building effective organizational systems must therefore involve experienced individuals from different key functional areas in the organization. No single individual can have the required knowledge to do this alone.

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Business Intelligence needs to get more strategic.

2006-03-09T13:57:00.000Z

I would like to focus in the next few posts on a specific knowledge-related activity: Business Intelligence (BI).

I will start by quoting the following article. It introduces very well what BI can ultimately enable at the retail end of a supply chain. A question I am asking myself is: If relatively mass market companies eventually manage to provide tailored products and services to individuals, how will luxury market companies respond to maintain their competitive advantage in terms of personalized products and /or services?

<<
Science fiction business is not so alien : The futuristic technology used by shops in the film Minority Report is not very far from current reality
James Murray, IT Week, 28 Feb 2006

When starting work on his 2002 sci-fi film Minority Report, one of director Steven Spielberg’s first acts was to invite a team of scientists, philosophers and designers to a “think tank summit” to envisage how the world would look in 2054.

[…] the summit proved pretty effective and the depiction of a dystopian society where all advertising is tailored to the individual customer is looking more prophetic with each passing year.

Minority Report’s vision of a world where people walk into Gap to be faced by holographic staff who greet them by name and ask how they’re getting on with their past purchases is intended as a nightmare scenario […]. But the fact Gap, as well as Guinness, Bulgari and Lexus, agreed to be involved suggests that this concept of individualised marketing is less a horror story, more a model of corporate efficiency.

The fictional systems that in Minority Report allow firms to tailor adverts to customers’ tastes are only an extreme version of analytical business intelligence (BI) tools that are already available and being embraced by many firms.

Even before 19th century department store mogul John Wanamaker complained, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half,” firms were looking for ways to guarantee returns on marketing. But in the last few years, evolving analytical reporting tools coupled with an exponential increase in computing power have resulted in BI systems that provide an answer to this age-old dilemma.

The latest generation of BI tools can analyse massive data warehouses to give firms a much better insight into customers’ habits and work out which buyers to target with which products. Online vendors such as Amazon were among the first to use this functionality to recommend items based on preferences of similar customers, but such systems are now being widely used in traditional shops to optimise pricing and marketing.

Applying the same BI capabilities to internal data has also given firms real-time information on supply chains and performance, allowing them to optimise processes. For example, several US clothing firms now analyse demographic and sales data in such depth that they can tweak supply chains so that the right clothes always go to the right stores. New York gets extra Armani suits and Florida receives all the surplus XXL Bon Jovi T-shirts.

This level of insight may make privacy advocates nervous, but according to recent reports, the way BI systems help optimise almost every aspect of companies’ operations – from production, through the supply chain to marketing – means those with a BI strategy are already outperforming those without […].
>>

Link to complete article: http://www.itweek.co.uk/itweek/comment/2151089/science-fiction-business-alien

Peter-Anthony Glick
http://leveragingknowledge.blogspot.com

Becoming a Knowledge-driven Organization in response to more knowledgeable customers in the luxury market

2005-12-16T17:10:00.000Z

Customers increasingly demand more personalized products and services. When the chosen product is relatively standard (mass-produced) they demand a personalized service around it. When the service is relatively standard (non-differentiating) they demand the resulting experience(s) to be unique.

In the World of luxury, this will not sound particularly new and challenging. For instance, the Richemont Group “Maisons” (French term used to represent the Brands owned by the Group) have been aiming to provide personalized product and services since their creation. However, even for them the context and the rules of competition are changing. Richemont customers, as much as for any other organization, do have increasingly access to more specific on-demand and interactive information. Customers are more knowledgeable about luxury products and services and about our competitor’s products and services. As a direct result, they have also more choice, or more precisely, they are more aware of having a choice.

Of course, one key medium at the origin of this phenomenon is the World Wide Web. It is now common for Cartier customers to download from a non-official web site a detailed product spec-sheet; and bring a printed copy to a Cartier boutique in order to be shown the product. Another illustration is the frustration of Panerai Management faced with a totally legal web site selling bracelets for Panerai watches. Even more worrying is the fast growing so-called “grey market” for watches, already a significant problem in North-America (these are genuine Richemont watches bought by wholesale accounts to be diverted onto a parallel network to be sold – usually on the Web - at discounted retail prices).

Traditional luxury companies will also face new types of competition. One of the most successful among wealthy people is fractional ownership. This is based on the old concept of time-sharing: Luxury products such as yachts, private jets, upmarket properties or luxury cars are shared by individuals who probably could afford to buy them outright, but find it much more cost-effective not to do so. What should be a concern for the traditional luxury brands is that this concept is starting to be available for fashion products as well such as ladies bags (http://www.bagborroworsteal.com/). Furthermore, existing or potential customers can easily share experiences and opinions on a specific luxury product and its related services, therefore at best, entering a point of sale with more pertinent knowledge; or at worse, deciding to opt for the competition before a sales-executive even had a chance to promote his products. For instance, there are very successful independent websites dedicated to luxury watches and watch-making where existing and potential owners of these wonderful time pieces can share related information. Jaeger-Le-Coultre benefits from such a website exclusively focusing on its products. It includes a Forum where customers, dealers and even JLC employees exchange experiences, ideas and opinions on various models (http://www.thepurists.com/). The key fact to note is that the website is independent: JLC management did not create it, has no input and even less control on its content.

This new competitive environment indicates that luxury Brands should focus on bridging the gap between them and their customers through co-creation of value with the customers (Prahalad & Ramaswamy, The Future of Competition, 2005). The idea is to organize companies in such a way so that all their valuable human resources based knowledge is leveraged through the creation of value for our customers and for the organization. This is done best in co-operation with the customers themselves. When a customer submits a problem at a point of sale of a particular international Brand name, the customer is in fact asking the whole company, not just the front line employee. Now can the organization ensure that the right person with the right knowledge is solicited at the right time to satisfy the customer? This is what becoming a knowledge-driven organization is ultimately all about: satisfying our customers faster and better and increasing revenue and profit as a result. A Knowledge-driven organization is focused on providing all the knowledge tools and assistance each of its front-line collaborators could benefit from, in order to deliver a better service. A knowledge-driven organization is inherently a customer-focused organization.

Typical Product and/or Market-focused Organization schematic representation:

The Organization/Customer Gap is reduced through product design assumed to satisfy the customers and through market analysis to adapt to each markets. The rationale is that the organization “knows” best what its customers need/want.

A Knowledge-driven and customer focused Organization simplified schematic representation:

A Knowledge-driven Organization sees its customers at the top of the pyramid with the whole Organization at their service. The goal is to co-create with the knowledgeable customers valuable and personalized experiences. In other words, such an Organization does not sell only products and services anymore but sells experiences.

Peter-Anthony Glick
Leveraging Organizational Knowledge

Read Verna Allee's comment to this post.

The Human Capital Formation

2005-12-12T10:51:00.000Z

Click on diagram to enlarge.

THE VIRTUOUS PROCESS OF HUMAN CAPITAL FORMATION.

Tom Stewart in his book “The Wealth of Knowledge” (2001) demonstrates how the building and leveraging of organizational knowledge assets can be at the heart of value generation. In chapter 14 (pages 311-313) he refers to Nick Bontis excellent work (http://www.nickbontis.com/ ) on human capital formation (see Nick's comment to this post). Based on this, I have devised a diagram illustrating the virtuous knowledge-driven processes that an organization should emphasize and consciously leverage upon.

The 3 goals are to:

Reduce Human Capital depletion.
Increasing Income per Employee.
Company performance in line with Strategic goals.

This virtuous process is to be maintained through a creative tension between the Company performance and both a Knowledge-Driven Organizational Culture and Knowledge-driven Organizational Capabilities.

This diagram might seem a bit too theoretical at first but it is in fact a pragmatic model. The process starts at the top of the diagram with common-sense and practical principles such as a strong charismatic leadership, recognition of individual and team performance, proactive career development or knowledge-driven recruitment process. An important fact to note here is that the implementation of these principles usually does not require very time-consuming and costly projects/initiatives. They tend to “pay for themselves” in the early stages, providing that they are recognized as strategic and benefiting from top-management support.

Peter-Anthony Glick
Leveraging Organizational Knowledge

Read Nick Bontis' comment on this post.

Open question: What does a flatter World mean in terms of organizational Knowledge Management?

2005-12-08T16:04:00.000Z

This is to start a discussion thread on the impact of our World getting flatter - mainly due to technological advances - on Organizations and their efforts to leverage their value-added Knowledge.

Note: To get a really good sense of this flattening of the World, I advise you to read "The World Is Flat: A Brief History of the Twenty-first Century" by Thomas Friedman (2005).

http://www.thomaslfriedman.com/worldisflat.htm

Reem Saied gives a good short analysis of Freidman's book. http://reemsaied.blogspot.com/2005/05/world-is-flat.html

An initial assertion: A Flat World increases the power of individuals through their specific knowledge.

Technological advances have made the World become “flat” and successful organizations of the future will be the ones that embrace this fact and take full advantage of it before their competitors. This increasingly flat World is described by Thomas Friedman as “[…] a global, Web-enabled playing field that allows for multiple forms of collaboration – the sharing of knowledge and work – in real time, without regard to geography, distance, or, in the near future, even language”. In such a World, it is clear that the span of influence of each individual is virtually the entire World.

The key value-adding differentiator for individuals is their specific knowledge (as the sum of their skills, competences and experiences, modulated by their interpersonal qualities and cultural background).

Peter-Anthony Glick
Leveraging Organizational Knowledge

Why all this fuss about KM now?

2005-12-05T13:30:00.000Z

Knowledge Management is about how an organization makes use of its intellectual property. It is about leveraging the knowledge produced internally or acquired externally, to add value for competitive advantage.

BUT WHY ALL THIS FUSS NOW?

Organizations always produced knowledge and this knowledge must have been used to add value somehow => TRUE
However, knowledge was not managed explicitly, formally, systematically because, until the 90's, it didn’t really need to be in order to add value.
In the increasingly Flat World we live in - with weaker geographical and political borders - individual and organizational knowledge is the most rewarding asset to leverage.

Find below examples of key benefits of Knowledge-driven initiatives in an organization:

Stop “reinventing the wheel”.
=> Similar or different solutions are applied to identical problems by different teams throughout the organization, when one solution could be applied for all.
What are needed are processes and tools to facilitate knowledge encoding and accessibility.
It must be facilitated to find out what has been done and who has done it.
Induce a “Knowledge is power when it is shared” culture.
What is needed is a top-management will and drive for a knowledge sharing culture, in which individuals, departments, teams, companies are encouraged, valued and rewarded for sharing their specific knowledge.
Effective replacement of experienced staff through knowledge acquisition and transfer.
A fraction of the significant costs associated with staff turnover could be directed towards proactive knowledge transfer from senior staff to more junior ones. Training, Coaching, apprenticeship, documentation are only some of the methods that could be generalized.
A company-wide team spirit or the systematic involvement of all the relevant stakeholders in projects and activities, all sharing specific and valuable knowledge and experience.
“When knowledge gained somewhere doesn’t move elsewhere, that’s not a learning organization; that’s just a bunch of projects” (Jac Fitz-Enz, HR analyst, founder of the Saratoga Institute).
What is first needed is for individuals and groups of people to be encouraged and valued for using their own knowledge and experience to constructively challenge the production of others. Furthermore, positive and negative feedback from all parties involved in projects and activities should be formally collected and made freely available to all for re-use (this relates to first and last examples as well).
Stop making the same mistakes twice (or many more times).
The risk of repeating mistakes can be considerably reduced with the generalization of relatively simple processes and tools, all centred on the principle of proactive knowledge sharing. In other words, the reasons and impacts of a mistake along with what was done about it is to be systematically recorded in a database available for others to consult.

I found on Pera the Innovation Company's website (www.pera.com) this very good support for knowledge-driven stategies:

"Global Knowledge
A Knowledge Based Business...
The best businesses today recognised a long time ago that their use of knowledge would be key to making them successful and they did something about it!
These businesses:
Thrive on chaos and uncertainty because it confuses their competitors
Welcome globalisation because it gives them access to customers and capabilities that their competitors are yet to comprehend exist
Welcome reduced product lifecycles because they know they are agile enough to get in and out of these new business spaces at speeds others can only imagine
Can be sure that China is not a threat because they know that the value they create comes from the man and not the machine
But what did they do?
Divorced themselves of the corporate mindset and released the spirit of the individual
Developed their human capital first and then watched their financial capital multiply
Looked across the business and to the world at large for inspiration not just to their leader
Realised that they exist in an ecosystem, not linear world
And then what did they do with this self-empowered, self-motivated, self-aware and profit hungry bunch of individuals?
They fed them knowledge and they made them money……"

Peter-Anthony Glick
Leveraging Organizational Knowledge