Put it to the board: Verna Allee

Transparency is an important topic in today’s management and leadership circles. The trend is fuelled by internet connectivity, the rise of civil-society networks and frustration with unethical business practices. Transparency refers to the increasing accessibility of information to stakeholders of organisations and institutions regarding matters that affect their interest. Every organisation has a web of stakeholders that extends beyond immediate customers and suppliers, or constituencies and vendors for government agencies. People who are affected by organisational practices are applying pressure on business leaders to reveal more about how they manage their business. Stakeholders might include customers, partners, suppliers, consumers, regulatory agencies, investment communities, advocacy groups, labour organisations, cities and regions.

In light of this trend towards transparency, companies must examine how they make decisions, what values drive those decisions and, most importantly, the quality and accuracy of the data and information that is provided about those decisions and their impact. In this environment, KM does more than increase competence, improve operations, and manage customer and supplier relationships. Knowledge-management practices lie at the heart of an organisation’s ability to respond accurately and ethically to the concerns of its citizens and stakeholders.

Because of concerns with transparency and governance, knowledge managers are now helping organisations document decision-making processes and develop accurate paper trails of how decisions are made and implemented. Companies are also revamping their records-management and retention policies to comply with regulatory requests while minimising the historical data and information that must be maintained.

Knowledge leaders also have an important role to play in educating management about practices in intangibles and sustainability reporting, and devising systems of indicators that support stakeholder communication. The need for such education is particularly strong in the US, which currently lags behind Europe in its understanding of intellectual-capital reporting, sustainability metrics and intangibles.
These changes in social innovation and behaviour will not happen by chance. Knowledge initiatives must have strong support for behaviour change, and social innovation around knowledge networks and expert communities. Transparency fosters trust, which is essential for knowledge sharing, collaboration and innovation.

People involved in KM must look out for broader business themes, especially those around transparency and governance. These emerging concerns offer a rich opportunity to demonstrate the value of knowledge-management practices in building capacity for organisations to govern and respond more effectively in a more transparent world.

Verna Allee
Verna Allee Associates