Knowledge-driven, not simply customer-driven

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.

Ok 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. 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” (*) !

(*) 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&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

«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

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?

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