Culture is Power - Inside Knowledge

Feature

posted 1 May 1999 in Volume 2 Issue 9

Culture is Power

This second article based on Good Practices in Knowledge Creation & Exchange argues that without a knowledge sharing culture no initiative will be worth its salt. That is why many attempts have produced more pain than gain. Dr. Amin Rajan & Kirsty Chapple summarise the efforts of companies developing knowledge management strategies and their various methods for tackling the out-moded traditional forms of corporate communication.

The three most widely cited constraints on knowledge sharing are:

the 'knowledge is power' syndrome

time pressures on key personnel

the 'not invented here' syndrome.

In order to overcome these constraints, companies in our study have launched a number of initiatives, some highly selective, others very general. Between them, they have promoted five key innovations in the organisation of work and collective learning. First of all this must consist of an intelligent search engine. This is created in six sequential steps, which involve:

Installing groupware or intranet which provide the necessary technological platform for knowledge sharing

Compiling 'yellow pages' which provide a list of individuals with the necessary expertise or knowledge co-ordinators who can provide help-line services

Facilitating the electronic transfer of knowledge by publicising these pages as personal web sites

Facilitating personal contacts - either face to face or via video conferencing - that enable individuals to access tacit knowledge

Building a personal recognition system based on the number of 'hits' per site and then using the system to influence decisions on promotion and reward

Creating an internal market in knowledge exchange between functions, divisions, businesses and countries.

The aim is to use revolutionary technologies to facilitate inter-personal contact and create an internal market in knowledge inside an organisation. Companies as diverse as BT and Scandia are using such an engine. For them, the currency of the internal knowledge market is not cash because it is viewed as reinforcing the functional silos that exist in many companies.

Instead, the currency they use are three Rs: respect, recognition and reciprocity:

1. Respect: This encourages individuals to come out with good ideas, even if they are not implemented in the foreseeable future. In some companies like Ford and The Forum Corporation, ideas go into a reject pool which is revisited from time to time to see if some of the ideas in it are worth resuscitating in the light of prevailing circumstances.

2. Recognition: This enhances an individual's own assessment self worth. In companies like Chrysler and IBM, they have identified a group of gurus. These are not long haired mystics that one finds at the foot of Himalayas! No, they are individuals who have acquired a personal mastery of certain subjects and are good at sharing their expertise. Their guru status enjoins them to be good role models in knowledge sharing. It also enjoins them to expand their mastery by learning how their expertise is being utilised by others.

3. Reciprocity: This reinforces the notion that a workplace is like a community where individuals have rights and responsibilities: nobody gets something for nothing.

The second set of initiatives involves establishing communities of practice. They embrace peers with a common sense of purpose and a real need to know what others know. In companies like AT&T (USA) and Fiat (Italy), they have become centres of expertise which is highly leveraged internally. They are accepted as useful tools in making explicit a company's untapped brainpower in disciplines as varied as R&D, engineering, finance, transport, logistics, marketing, joint ventures, and fund management to name a few. They rely on the search engine as much as face to face contacts.

The third set involves establishing virtual teams, embracing individuals split between different locations and often time zones. Team meetings are held, using video conferencing and groupware spreadsheets such as Lotus Notes, which allow team members to 'meet', share information and work on documents in real time. In all cases, great care is taken to avoid a sense of isolation by ensuring that members have met personally and continue to meet occasionally in order to forge personal relationships and a team culture. The initiative of BP on virtual teams is world renowned, having merited the Smithsonian Prize in Excellence.

The fourth set focuses on action learning. It enjoins key personnel to participate in projects which are overtly designed to develop the key skills of the learning organisation - skills such as systems thinking, common mental models, team learning and self learning. The projects involve decision making through intensive inter-personal communication with colleagues drawn from different subject expertise and business units. Shell have promoted action learning as one of the main vehicles for leadership development.

Finally, and most importantly, most companies in our research are fostering culture-based learning. This is being done by adopting certain business values that are conducive to knowledge sharing and then implementing them in corporate processes and systems. Large companies are mounting initiatives in this area, as we shall see below. In doing so, they are taking on board the ethos and practices that have long prevailed in knowledge-intensive professional services firms like Ernst & Young, Arthur Andersen, Allen & Overy, and Slaughter & May. Since these firms create and sell knowledge, over time they have built many of the ingredients of a culture in which sharing and serendipity occur as part of everyday activity.

All the successful companies in our study are now fostering culture-based learning by doing three things:

first, they are adopting business values that encourage experimentation and tolerate mistakes

then, they are implementing IT and personnel systems that help to operationalise these values through formal processes and procedures

finally, they are encouraging individual behaviours that are consistent with business values.

Under each of these headings, companies are implementing up to 14 practices. Some have involved changing recruitment, selection and reward criteria; some have involved introducing coaching and mentoring. Some have involved generating a strong sense of shared interest. Companies as diverse as BMW, Motorola, NatWest and Zeneca have implemented practices which appear fairly similar.

In one sense, this is not surprising, for in all cases irrespective of the nature of their business, the aim has been to encourage behaviours that seek to over-ride the 'knowledge is power' syndrome as well as 'not invented here' syndrome.

As an aside, it may seem odd to relate values and behaviours to the subject of organisational knowledge. After all, we are often led to believe that organisations are objective and neutral, like a pristine laboratory. They aim to create a product or provide a service; and that goal may seem unrelated to values and behaviours.

However, as we all know, reality is different. People's values and behaviours are integral to knowledge, determining in large part what they see, absorb and learn from their observations. According to Nonaka and Takeuchi, two famous Japanese management gurus, unlike information, knowledge is about beliefs and commitment. This, in truth, enables us to make a controversial observation: namely, in some companies at least, knowledge management is old wine served in new bottles. It is a response to yesterday's unsolved problems.

As we all know, in this decade, companies on both sides of the Atlantic have embarked on major change programmes. Under them, they have sought to replace the old bureaucratic model of command and control by a new one based on high performance and continuous learning. The behaviours required by the new culture are in fact, not too different from the ones associated with successful creation and exchange of knowledge; although we hasten to add that, back in the early 1990s, that was not how they were received.

Let us list some of these behaviours in order to substantiate our point. Amongst others, they included:

Generating and implementing new ideas

Working in teams

Taking initiatives and experimenting

Learning from mistakes and sharing the lessons learnt.

Yet, some seven years later, the scorecard does not look so impressive. On a realistic interpretation of the outcomes, only one out of every three programmes have generated the relevant behaviours. In the rest, the change programmes have amounted to respraying an old car. They have improved the external appearance but not the engine performance.

At this point, we cannot resist the temptation to recite the experience of one global American bank. It nearly went bankrupt in 1989 as a result of a series of bad lending decisions in the last decade. So, it decided on a major corporate re-engineering process, which also involved changing its culture.

Some seven years later, one of us went to interview the CEO of this bank in the context of a study we were doing on how to develop tomorrow's business leaders. As the conversation developed, he became more open. So, one was able to pop a few blunt questions.

-'how would you describe the culture of this bank pre-rationalisation'?
Being an ex-lawyer, his answer was succinct. He said:'it is best described as dog eat dog'
-'And now seven years later?'
He was equally succinct in his reply: 'Now, it is the other way round.'

In other words, they have moved 180 degrees, but they are still on the same level. However, he went on to make what we thought was a very pertinent point, namely that corporate cultures are like giant jellies. Unless you fundamentally shake them, they swiftly wobble back into their original position.

In this respect, our research shows that in some of the largest companies at least, their overt

knowledge management initiatives are designed to give a fresh impetus to a process that started long ago under a different guise. Of course, there is nothing wrong with this approach since it provides a more meaningful framework for achieving culture change. More importantly, it uses a language that people at the workplace relate to easily. In contrast, the language of change management in the early Nineties was mainly about 'shareholder value', to the extent that it did not answer the two most frequently asked questions by employees at today's workplace, namely:

'How will the change affect me'

'What's in it for me?'

In any event, the language was often loaded with hype. Of course, in change management a certain amount of hype is necessary in order to generate a sense of urgency and excitement. In fact, many change programme have tended to:

Over-simplify the past, since it has already happened and we've lived through it

Over-exaggerate the present, since today is the day we feel the pain and

Over-glamorise the future, since it is nice to emphasise that today's pain will lead to tomorrow's gain.

Many organisations in private and public sector alike have found it difficult to go beyond the hype. Their knowledge management initiatives are enabling them to go back to the drawing board in earnest attempts to resolve yesterday's problems. And they are all starting with culture.

Professor Rajan is Chief Executive of CREATE. Kirsty Chapple is Research Manager at CREATE. They can both be contacted at:
create_uk@compuserve.com

'Good Practices in Knowledge Creation & Exchange', by Amin Rajan, Elizabeth Lank and Kirsty Chapple, is available from CREATE, 15 Tonbridge Chambers, Pembury Road, Tonbridge, Kent TN9 2HZ Tel: 01732 369191 Fax: 01732 369292 email: create_uk@compuserve.com http://www.create-research.co.uk

CREATE has set up a Good Practices Network. For further details, please contact Kirsty Chapple: details as above.

Knowledge Management subscribers can receive a discount of £19.50 on a copy of the report: - Good Practices in Knowledge Creation & Exchange' @ £30 each. (normal price: £49.50). Tel: 01732 369 191