People-Focused Knowledge Management

Karl Wiig

• Publisher: Routledge
• Year: 2012
• eBook ISBN: 9781136374272
• Topic: Business
• Subtopic: Business General
• Index: Business

The business environment has changed. Sharper competition requires organizations to exhibit greater effectiveness in their operations and services and faster creation of new products and services—all hallmarks of the knowledge economy. Up until now, most of the knowledge management literature has focused on technology, systems, or culture. This book moves to the next stage, to focus on the people—the knowledge workers themselves. Noted expert Karl Wiig synthesizes recent research findings in cognitive science and related fields to describe how people actually work. He focuses on how people learn, remember, make decisions, solve problems and act—in general, how knowledge relates to work behavior. By understanding how people work, managers can improve effectiveness to gain competitive advantage.

1

Competing in the Global Economy Requires Effective Enterprises

Premise 1-1: The Global Economy Demands Excellence

The global economy reaches everywhere. Enterprises throughout the world provide cost-and-feature competitive products and services wherever they find customers. They also seek partners and suppliers wherever they can obtain the most advantageous cost-and-quality combinations. Everyone has access to the same markets and the same suppliers. Under these conditions, any organization that provides deliverables in the competitive global market can only succeed through excellence — by being best among competitors — by delivering products, services, or combinations of these that are of the greatest value to its customers.

In addition to being excellent, advanced enterprises strive to remain leaders by innovating faster than their competitors since only learning faster than their competitors often means adopting what others — their competitors — already practice.

The Competitive Enterprise Example

For 25 years Jones Development & Engineering, Inc. has provided advanced technology services to industrial customers in many industries. Jones assists customers in creating prototypes of complex high-performance products that utilize advanced technologies and materials. Jones’s staff collaborates with customers to conceptualize, design, and engineer products that must perform well in very demanding applications. They also work with customers’ customers to understand their problems so that they can properly address the issues they have. Most often, Jones starts work with customers in the initial conceptual stages of new product development followed by pilot production and product introduction. Later, Jones’s staff assists by handing over production to customers’ operations, often working for months in customer facilities to achieve full technology and expertise transfer.

Jones has grown steadily to become the international leader in its niche and works hard to maintain its leadership position. The company is very profitable with a large and faithful customer base. In many ways, Jones operates like many of its competitors, yet pursues practices that are proactive and deliberate and therefore quite effective, which sets them apart. Some examples of these practices are as follows.

Provide superior customer value — Jones’s management emphasizes the need to provide the best matches to the individual customer’s needs and requirements, thereby providing the highest possible value to customers.

Understand customers — Jones’s employees recognize that it is absolutely necessary to understand their customers’ business purpose, direction, objectives, and their marketplace and that Jones’s products and services contribute to the customers’ value creation and how to help customers succeed.

Understand technology opportunities — Jones’s employees work to understand how and why customers, and the customers’ customers, benefit and are affected by different technology solutions.

Collaborate with customers to maximize value of assistance — Jones’s teams collaborate with customers to conceptualize and engineer new products. The teams consist of a mix of researchers, design engineers, and crafts people to allow immediate incorporation of insights into advanced solutions and practical assessments of how solutions can be built in the factory.

Develop relationships — Jones’s management emphasizes the need for employees to network and develop good relationships with customers, suppliers, and coworkers. They rely on these relationships to understand what is needed and what they can provide. Internal relationships are crucial for frictionless and effective operations and for support of workforce morale.

Understand the universe of product opportunities — Jones’s management and employees — professionals and crafts people — are continually provided with opportunities such as participating in professional meetings to understand the importance of utilizing and benefiting from advanced technologies and materials.

Ascertain that the company has command of state-of-the-art technology — Jones invests in advanced technology expertise early — through benchmarking or acquisition of licenses and equipment — and experiments with promising technology in the factory for trials and familiarization before they are needed for customer work.

Prepare employees to implement corporate strategy — Through companywide information, education, discussion, and feedback programs, Jones’s employees build understanding of corporate thrusts, direction, and strategy and of how they as individuals can assist in implementing the company’s goals. Employees also understand how their future depends on their own performance and the company’s long-term and durable success.

Innovate faster than competitors — Jones’s management believes that to keep their leadership position they need to learn quickly and innovate faster than their competitors — in technology, in management and operational practices, and in strategy.

Support personal learning — By understanding why it is to their personal benefit, Jones’s employees take it upon themselves to learn about advances in every field they think will be important for their work. They are recognized and rewarded as a group for practical curiosity, innovations, and their ability to collaborate and share insights. Jones’s culture fosters agility, versatility, and flexibility in a noncompetitive, safe environment.

Foster knowledge-focused mentality and culture — Jones’s senior management believes that each employee must understand, as second nature, how better knowledge is built and leveraged — through personal and company investments, through collaboration, and through deeply entrenched and practiced tradeoffs between short-term facilitation and long-term strength.

As a result of pursuing such practices, Jones Development & Engineering, Inc. has been able to maintain its global leadership position. In addition, it has become a role model for other proactive organizations that also work to become leaders in their market niches.

The Global Economy Challenge

Many factors drive the global economy and make the world a challenging business environment with complex implications for most courses of actions. That makes it difficult for some enterprises to provide products and services with sufficient margins to stay in business. For others, it makes a much larger marketplace with near endless opportunities. Positive aspects of globalization provide new opportunities for enterprises and individuals throughout the world, including developing nation states. For the first time, many people are able to contribute and improve their quality of life regardless of their geographical location. Such changes are particularly noticeable for people who deliver knowledge-intensive products and services to customers in other parts of the world. Numerous examples can be cited where new international industries have emerged in geographical areas that earlier were quite isolated. Services ranging from software development to call centers are provided from locations that previously were isolated in Asia, Latin America, and Africa. In addition, sophisticated design and manufacturing that traditionally were performed only in industrialized nations have migrated into countries that earlier did not have the capabilities to deliver such products.

Globalization causes work itself to become more complex. Work must satisfy requirements for improved effectiveness and provide deliverables with new features and increased capabilities that provide the needed competitive value in the global marketplace. In response, competitive enterprises prepare their workforces better, automate or outsource many routine functions, and organize work in ways that produce new deliverables. In many situations, work becomes more sophisticated and expands to take advantage of new capabilities brought about by the increased availability of personal and structural knowledge. Efficiency is improved by automation systems that perform routine tasks, thus freeing people to apply greater expertise to more demanding and value-creating work. Application of advanced technology and development by sophisticated organizations continue the refinement of work in general.

Figure 1-1 presents an example of the globalization complexity. Nine independent factors indicate the diversity of influences that affect global economy opportunities and pressures. In the context of this book, it is important to understand that every one of these factors is influenced by the effective actions of people at every organizational level — by their competence, their expertise, and their knowledge. To a lesser, but very important, extent, technology, especially information technology (IT), also influences how these factors will change performance in the global economy.

Figure 1-1
Many Knowledge-Related, People-Focused Factors Influence Globalization Opportunities and Challenges — and the Enterprise Ability to Succeed and Individual People’s Ability to Thrive. Copyright © 2001 Knowledge Research Institute, Inc. Reproduced with Permission.

Globalization causes work to change and become more complex, satisfying requirements for improved effectiveness and providing deliverables with new features and increased capabilities. To compete, enterprises strive to increase performance productivity on both micro and nano levels. They prepare their workforces better, automate many routine functions, and organize work in ways that create better deliverables. Automation systems perform routine tasks, thus freeing people to perform more demanding work, which inevitably enables them to add more features and options and to further complicate work. Work expands to exploit new knowledge capabilities.

The World Requires Us to Change

The world has changed in its features and its relationships and, perhaps more importantly, in the speed by which new changes and requirements are introduced. In the new millennium we have been awakened to different driving forces in local and international economies. Earlier, enterprises could exist comfortably within narrow geographical and market boundaries. Now most, even small enter-prises,¹ are forced onto the globalized competitive playing field and are subjected to rules that often are quite different. Customers everywhere are more sophisticated and demand individualized products and services to a degree not thought possible a few years ago. Suppliers have access to well-trained and efficient workers in most parts of the world — some at very low costs — making it attractive to seek new alliances. New competitive products, technologies, and service capabilities are introduced into the market overnight. New business practices such as business-to-business (B2B), including supplier bidding systems, are emerging everywhere and are utilizing new vehicles like the World Wide Web. Crafts people, professionals, managers, and whole organizations must act differently to maintain their accustomed lifestyles by delivering work that requires greater personal knowledge. Employee and customer loyalties are changing and are often reduced sharply.

To survive and prosper, most enterprises find that they need to tailor their activities to unique situations. They need to act effectively and “intelligently” in order to provide customized goods and services and otherwise adapt to new contexts. Viability, success, and progress no longer depend extensively on exploitation of depletable resources. Instead, innovation and pursuit of knowledge-based practices and opportunities are new drivers, not only for new-type businesses, but also for traditional industries. In particular, enterprises realize that they must continually build and apply high-quality and competitive knowledge. They must make available and leverage competitive personal and structural — tacit and explicit — intellectual capital (IC) to facilitate the intellige...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright
• Contents
• Acknowledgments
• Preface
• Foreword
• Chapter 1: Competing in the Global Economy Requires Effective Enterprises
• Chapter 2: The Effective Enterprise
• Chapter 3: Actions are Initiated by Knowledgeable People: People Make Decisions and Act Using Different Kinds of Mental Functions
• Chapter 4: Mental and Structural Reference Models
• Chapter 5: A Knowledge Model for Personal Situation-Handling
• Chapter 6: Enterprise Situation-Handling
• Chapter 7: People-Focused Knowledge Management in Daily Operations
• Chapter 8: People-Focused Knowledge Management Expectations
• Appendix A: Examples of Knowledge Management Analysis Approaches
• Appendix B: Examples of Knowledge Management Practices and Initiatives
• Appendix C: Memory and Knowledge Categorizations
• Glossary
• References
• Index