Friday, October 23, 2009

Knowledge: Currency, Potential, Impedance and Serendipity.

There is a widespread understanding, come of recent years, that organizations benefit enormously by sharing best practices and know how between their distinctive functional areas as opposed to simply within these functional areas.

This sharing can be shown to have major impact on business efficiency and employee morale as well as providing a competitive advantage in terms of being responsive and innovative to change demands made of the business units and the enterprise as a whole.

The organizational discipline best placed to enable this type of sharing is often called "Knowledge Management" or KM, a rather dull and sleepy term with implications of librarians and heavy top down control.

Notwithstanding this, KM is a handy way to begin a study to better understand the way the organization currently uses it's knowledge networks and by extension to define a vision and a path to change the current picture to something better.

KM / NO-KM

KM exists everywhere in a natural form. It is practiced best by those who inherently understand the value of knowledge and instinctively know how to turn its possession to their own best advantage.

For example:

Mike:
"Joe, do you have that report we sent over to HQ a few months back. The one that described the best way to set up a water purification kit distribution network in east European countries?"

Joe:
"Sure, give me moment to look for it later today and I will send it over"

Joe provides the report because he has been diligent about keeping a copy of it and, always made sure that while the report was being created he kept abreast of the most recent copy and always updated his own copy with the newest one.

Joe has good KM hygiene practices and people know this which is why they ask him first. He also has a well organized knowledge store on his hard drive, email folders and network shared drive. People often recall when the section head called on Joe for a copy of one of his own emails because he had lost his original.

It is worth noting that Joe may not provide the request item immediately although he could because he is well organized. He adds some delay because instant access might imply easy access and he could be called upon to always instantly provide the material requested.

No, for Joe to extract the true potential value of the report he must add value of his own beyond the work he did keeping abreast of the versions and then filing it carefully. He must do some additional work to get the report for you, because you asked for it ie this was an additional effort on top of what is otherwise his normal effort of managing his knowledge store.

By doing this for you, you in effect owe Joe some credits which he may choose to exchange with you for something else of value, like a quick summary of what was said at the meeting he was not invited to or, the contents of an email from the boss he did not get.

Knowledge movement in this environment encounters pervasive access impedance, often created to increase it's perceived value.

Joe and the nodes of knowledge exchange are often called knowledge hoarders but might be better called knowledge "brokers" (though some really do hoard) as they trade up and down their own unit using a network of contacts with whom they are constantly exchanging things.

It may be the case that they are also, like brokers, aware of opportunties to capitalize on a peice of knowledge before others do and in this case they are just like real market makers in our financial system, trading on somewhat specialist knowledge about the value of knowledge.

It is said that when put in a demanding situation, possessors of hoarded knowledge will usually offer it up for free.

If you think about this further you can see that it is not free but a different sort of currency is being used to purchase the knowledge. This is still a very valuable transaction. Who looks good when they can come up with the information so badly needed..? The value on offer simply moved to the front of the transaction.

Because of the value component, knowledge has a viral means of locomotion through organizations. This comes about as a result of it's potential. Original attribution of knowledge is often indeterminate so the apparent source of the knowledge, the broker, accrues some additional value which might otherwise have accrued to the author. This increases it's value for the broker.

All of the above is Naturally Occurring KM or NO-KM.

This occurs inside business units and typically means that knowledge moves up and down the unit, generally from a realm of initially shared and open access (low impedance) to later restricted access where it has a cost of retrieval. The knowledge accrues value by it's scarcity and by the access impedance it gathers as the brokers put it away.

The more important something is, the further up the silo it will move and the higher the value that will accrue to it because, well, that's where the money is.

For a knowledge broker to trade across business units or 'silos', there has to be something of value on offer. The transaction with a senior member of another business unit may indeed be of value but more likely is not so often there is no offer.

Equally, the transaction with a peer in another unit may be of value but it assumes the peer has had a chance to get a summary of the knowledge at some point and already determined it has value. This is actually a hard thing to do as it means that person had to deliberately reach beyond their own domain to inquire of someting in another, typically this act alone generates high impedance.

Notice here that the seeker has already a clear idea of what it that is valuable about this knowledge "artifact" and has located a possible source. The seeker has done considerable work to get to this point and have encountered substantial impedance consuming substantial capital.

Now they need something to trade with and they may not have anything as they are in a different business unit whose currency of power may not convert readily into the one valued by the broker.

We can see that these are classic market principles at work.

Clearly then we can say that, in typical organizational structures with well defined business units and verticaly integrated functional units, the normal movement of knowledge does not include movement across the functional units.

Why then would knowledge shared freely be a desirable thing?

Is this really what widespread thinking now proposes when market principles of knowledge dictate that it is not valuable across boundaries of function and enterprise?

The answer comes from a fairly new understanding.

It turns out that organizations thrive on innovation and innovation thrives on serendipity.

The availability of a few pages describing the way a development project in Senegal structured it's emergency communications program to achieve maximum impact with minimum points of failure and in the shortest time may turn out to be the catalyst for an idea that, when developed by HQ becomes the basis for a global communication channel to be used in all business units that results in far greater effectiveness in information transmission for emergencies.

Or: the piloting of a simple program where SMS TXT nuggets carrying basic ID, Health and Treatment data for children in remote locations with no internet connection may turn out to hold the germ for an innovative, simple and cost-effective system to be used in all vaccine-drop locations to instantly cross-check the shipping manifest with the viability of the delivered product and so facilitate an instant re-order to cover the difference and save many days over the traditional paper and Fax methods.

Imagine a local office has introduced a pilot program to debrief field officers by use of a small questionnaire delivered by via mobile phones as the data gathering step before getting a summary of lessons learned posted to the office intranet. This new process takes 24 hours instead of the typical twenty days.

The regional office get to hear about this effort and the learning behind it as part of a formal KM review process that heppens weekly and encourages offices to share their best knowledge with each other. This gets rapidly circulated to the regional directors and the subsequent regional deployment of the new debrief workflow to all mobile phones results in dramatic levels of field level process improvement in particularly complex programs.

These ideas and many more come about when we introduce a serendipitous element into our planning and innovation processes along with incentives to freely share knowledge.

This is how the human mind works best.

So, from an enterprise perspective we can see that there is huge value proposition for any organization as a whole when it's own knowledge resources flow sideways and not just vertically.

However, because the extant value framework in a NO-KM environment does not typically reward the brokers to facilitate this sideways flow, they do not accrue any obvious credits when a program in another group at a different level of function turns out to be successful simply because someone got access to the seed of an idea in a KM document the broker gave away for free.

So, for enterprise KM to take root, the value framework must be changed such that the ingrained NO-KM behaviors begin to accrete negative value to the broker. They diminish broker stature. This is not punitive in the formal sense, it simply sends the message that the currency for trading knowledge has changed and there is a new currency to be adopted.

Once adopted, the brokers may find themselves in a rather different position but there is strong likelihood they will still be central to the process. After all the most valuable knowledge is not just what you know or, what you know has been written down, it is what you know others know, this is a form of broker inside information.

This last point is very important. Organizational knowledge brokers are a crucial part of the process and must continue to be encouraged to practice their discipline and good KM habits, but these behaviours need to be ubiqitous in their adoption and aligned to support lateral knowledge flows and this is achieved by introducing a new currency and transitioning off the old.

No more NO-KM.

So team, how do we change the currency?

Monday, October 5, 2009

What, exactly, are we doing here......?

Finally an answer to this question in the form of a paper published by the ODI:

"Implementing Knowledge Strategies:
Lessons from international development agencies
Ben Ramalingam
April 2005
Overseas Development Institute
111 Westminster Bridge Road
London
SE1 7JD
UK"

Buried in some fairly dense text is the following:
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2.3 Knowledge for development: background

Despite the growth of the knowledge economy as described above, the awareness of the central role of knowledge in economic and social development is far from new. The initiation of the age of
development itself has been linked by many thinkers (Sachs, 1989; Rist, 1997; King and McGrath, 2004, among many others) to Point Four in the inaugural speech of United States President Truman in 1948.

Because of its clear focus on the transfer and utilisation of knowledge, the text of the speech is worth reproducing here:

‘...Fourth, we must embark on a bold new program for making the benefits of our scientific advances and industrial progress available for the improvement and growth of underdeveloped areas.
More than half the people of the world are living in conditions approaching misery.
Their food is inadequate.
They are victims of disease.
Their economic life is primitive and stagnant.
Their poverty is a handicap and a threat both to them and to more prosperous areas.


For the first time in history, humanity possesses the knowledge and the skill to relieve the suffering of these people... The United States is pre-eminent among nations in the development of industrial and scientific techniques. The material resources which we can afford to use for the assistance of other peoples are limited.

But our imponderable resources in technical knowledge are constantly growing and are inexhaustible. I believe that we should make available to peaceloving peoples the benefits of our store of technical knowledge in order to help them realize their aspirations for a better life...’ (Truman, in speech, 1949, emphasis added)

But this transfer was also increasingly recognised as being far from simple a process. As it was put in an American Economic Review lecture in 1966:

‘The recognition that development is essentially a knowledge process has been slowly penetrating the minds of economists, but [they] are still too much obsessed by mechanical models…to the neglect of the study of the learning process which is the real key to
development.’ (Boulding, 1966)


Such ‘mechanical models’ of knowledge have informed much of development theory, in the form of modernisation theory and its variants, and development practice, through for example, technical assistance. However, knowledge and learning was brought high on the development aid agenda in 1996, in the inaugural speech of the incoming President of the World Bank.

Before 175 international Finance Ministers, James Wolfensohn – a former investment banker – made the following announcement:

The Bank Group’s relationships with governments and institutions all over the world and our unique reservoir of development experience across sectors and countries position us to play a leading role in a new knowledge partnership... To capture this potential we need to invest in the necessary systems that will enhance our ability to gather development information and experience and share it with our clients. We need to become, in effect, the “Knowledge Bank”.’
(Wolfensohn, 1996)

There is some evidence to suggest that the motivation for this strategic shift was not simply the stated vision of improving effectiveness (King and McGrath, 2004). At the time, the Bank was facing increasing criticism for its practices, and the knowledge programme was a key response to this.

It is worth noting that the development-specific rationale for the shift was to come later, in the 1998 World Development Report, Knowledge for Development, which stated that:

For countries in the vanguard of the world economy, the balance between knowledge and resources has shifted so far towards the former that knowledge has become the most important factor determining the standard of living – more than land, than tools, than labor.’ (World Bank,
1998)

Since the publication of Knowledge for Development there has been a rapidly increasing emphasis on the knowledge and learning, leading to a renewed attention on both development processes and development organisations as essentially ‘knowledge-based’. This has led to the widespread adoption of knowledge-based strategies amongst the plethora of agencies within the development sector, including donor agencies, non-governmental organisations (NGOs), research institutes, and institutes based in the South (King and McGrath, 2002).

There is now an increasing appreciation, in development organisations of all sizes, of the value of knowledge and learning practices in terms of enabling timely access to institutional knowledge (Creech and Willard, 2001).

The trend through which the knowledge and learning approach has seen its apotheosis in development agencies has been variously termed ‘knowledge for development’, ‘knowledge-based aid’, ‘KS’ or ‘OL’.

The specific practices advocated cover all of those outlined in the conceptual model articulated in section 2.1 focusing on better knowledge and learning within given organisations. The movement also includes, however, a set of practices geared around the notion of sharing knowledge with Southern counterparts and the poor, and a further set which addresses knowledge economies in the South and attempts to overcome issues of the ‘digital divide’ (World Bank, 1998).
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Thanks for sharing that.