There is much talk about the high importance of "knowledge management" and
"intellectual capital" in the unorganized world in which we work with our
heads and not with our hands. In the unorganized world, the only property
worth owning is intellectual property- the only matter that matters is
brain matter.
Knowledge is relevant, useful information about things that are important
to the organization such as its customers, competitors, product
development processes and so on. Knowledge management is all about
capturing and leveraging valuable information and making it available
widely for use by other people throughout the organization. Knowledge
management concerns itself with packaging up information into "components"
that when combined and modified can be reused in other places and contexts
by other people in the organization.
Positively, knowledge management techniques are lateral across the
organization and therefore transcend current structures. This reduces the
dependency of employees on their fellow department members. The knowledge
is stored and accessible throughout the organization regardless of
geography or operating unit. This is achieved using new technologies such
as intranets and relational databases. This means that someone in one area
of the company can access information from other areas and past projects
to help them make sense of and respond to current projects for different
clients. Different employees can refine rather reinvent knowledge and
thereby respond more quickly and more fully to the current demands of
customers.
In the pre-knowledge management era, most situation and job-specific
information resided in the heads of people. Other people may have been
carrying out the same sorts of jobs in other parts of the same
organization. Yet, the two people may not have talked to one another, let
alone shared knowledge about how best to get their similar jobs done. It
is also quite clear that knowledge has in the past been difficult to
access- because it resided either in brain cells in heads or on paper in
locked up filing cabinets. Moreover, some senior managers deliberately
protected their knowledge whereas the new imperative for leaders is to
diffuse useful information throughout the organization.
The value of having a knowledge database within an existing organization
depends upon the extent to which the knowledge and ideas available IN the
company are more useful than those available outside the company. External
knowledge sources include Internet-related media such as web sites and
external communities of interests in the form of discussion forums and
email lists such as learning-org.
It would be interesting to compare the value of the knowledge gained from
a sensitive search engine such as Alta Vista on the Internet and from a
proprietary database. Perhaps the internally stored knowledge would be
more specific to that company and its requirements- requiring less
original thought from the employees to solve the problem. Information
overload is a myth. Technology tools such as search engines and electronic
agents give everyone the ability to filter down and closely identify the
exact type of answers they want.
Knowledge management is less useful when the answers have not been
generated in that organization at all. This is the case even in the
impossible situation of having a knowledge database that is completely
coherent and therefore containing all the valuable knowledge that resides
within the organization. Organizations must be certain to reassess the
truth in the knowledge every time they reuse it- in a fast changing world,
information captured in the past may no longer be relevant. For example,
some management consultants and Internet commentators have made the
mistake of extrapolating the increasing returns model to explain the
content-driven era, when in fact it ceased being important in the
distribution-driven era.
It is clearly useful to encourage information "externalities" where
someone else benefits from being a employee of a particular organization
because they can access the proprietary knowledge of others in the
company.
Whether I would want to join a management consultancy in order to gain
access to its confidential knowledge database is very mute indeed. Its
value would depend on the unique truths in its knowledge. These insights
and truths are not available from any other sources and are applicable to
other situations.
I can understand why organizations want to gain access to the knowledge in
their employees heads. I can understand how employees can be rewarded for
complying with such systems and contributing to the knowledge database. In
fact, gathering the knowledge is necessary but not sufficient for
successful knowledge management- that knowledge has to be used and
applied. Hence, rewarding employees for sharing and using knowledge is
necessary to get people to use the system extensively. Once they have
shared all their valuable information in the knowledge database, employees
need to continue creating new knowledge.
Knowledge management is the search for an advantage of persisting with
organizations as we know them based on formal membership. It is an attempt
to turn an organization into something more than just a formal and
uncomfortable collection of individuals working in the same company but
not necessarily together or for the same ends.
I can understand why it is useful to have a knowledge database so that
when an employee leaves the company- the new recruit has access to the
knowledge nuggets of wisdom left behind. Currently, successors have to
rely primarily on just a set of quality manuals and procedures explaining
what actions to take to do the job- but not how or what to think.
Knowledge management is to knowledge-based organizations what job
procedures were in administration and manufacturing-based organizations.
Of course, downstructuring is all about removing the static structures
such as job titles, operating units and so on that artificially prevent
employees from collaborating with each other. Downstructuring switches the
collective focus from procedures, policies and processes onto the people
who make up the organization and are its most valuable assets. As such,
knowledge management and downstructuring are complementary techniques.
It is very easy to imagine the implementation of knowledge management
exercises as mandatory. Information "components" would then be passed up
the hierarchy and signed off and agreed by managers before being posted to
the knowledge management database. The knowledge sharing and collaboration
is not voluntary but mandatory. Compulsion is never the best way of
achieving something. All that changes is that the information is posted to
a central database as well as to customers and close colleagues.
The fundamental flaws of organized business organizations of bounded
rationality, dependence, transaction costs and force (See the forthcoming
update to "unorganization: A handbook for individual transformation")
coupled with the fundamental change in the operating environment that is
the global and diverse unorganized world mean that knowledge management is
improvement within a suboptimal organizational form. It is evolutionary
improvement in a fundamentally different world.
The optimal way to share knowledge and stimulate effective collaboration
and creation to meet end customer requirements is within collapsible
corporations. In these dynamic organizational forms, people with
complementary expertise voluntarily collaborate to share knowledge in
order to solve a particular problem. Such voluntary free market based
forms optimize the incentives to collaborate and widen the quantity and
quality of knowledge that can be accessed.
In sum then, knowledge management is useful but not sufficient to ensure
the survival of organizations as we know them.
Sources:
Allan Punzalan Isaac, Codifying not-so-common sense, Metropolis magazine,
November 1997
The power of knowledge: A Business Guide to Knowledge Management, KPMG
Management Consulting
Hope and Hope, Competing in the third Wave, 1997.
A "Dispatch from the unorganized world" at http://www.unorg.com/weekly.htm
Simon Buckingham
--Simon Buckingham <go57@dial.pipex.com>
Learning-org -- Hosted by Rick Karash <rkarash@karash.com> Public Dialog on Learning Organizations -- <http://www.learning-org.com>