posted 8 May 2003 in Volume 6 Issue 8
Any project that deals with intangibles faces a number of hurdles before it will become part of day-to-day working practices within an organisation. Jason Slusher looks at the principles firms need to follow if they are to ensure their knowledge-management programme is effectively institutionalised and digested.
Karen is a veteran human resources (HR) director for a global, medium-sized picture-frame manufacturer. Senior management asks Karen to recommend a knowledge-management initiative for the organisation that focuses on internal collaboration and networking. Karen is selected for this position given her experience working within the company’s culture, her reputation for implementation and, most of all, her recent success in completing an HR initiative, which has left her free to work on another project. Karen selects a KM project based on what she believes will fit best within the company’s structure, recommends it and is asked to implement the project. Team members are assigned to the project and begin planning for implementation. The team delivers a robust project designed to enhance internal collaboration and networking.
Impressed with the swiftness of her delivery, senior management asks Karen to continue to direct the project for a few more months to ensure the employees accept the new system. Within the first month, Karen notices resistance to the KM project. The employees under-perform on their newly assigned tasks. Rumours spread about middle management’s negative feedback about the collaboration and networking project. Worse, the company disappoints analyst expectations. Lay-offs begin and senior management sends signals to the company suggesting a focus solely on core (traditional) business practices. Eventually, Karen moves to other initiatives within the company and the collaborative KM project, although still technically in place, falls by the wayside.
In this example, Karen failed to enable the organisation to digest the collaboration and networking initiative. Ensuring institutionalisation – the establishment, acceptability and sustained use of a new initiative – is what I call ‘organisational digestion’. Examples of universally digested projects are common. Meetings, flipcharts, advertising campaigns, handshakes, financial statements, the telephone, etc, are all fully accepted into the fabric of how organisations accomplish business goals. Conversely, concepts such as structured storytelling, communities of practice, intellectual-capital management, expertise management, customer-knowledge management and so on are often not fully digested by organisations. Rather, they are spat out after sampling (as in the case above), regurgitated after a few attempts, or ingested but quickly returned to the earth via organisational excretion.
Knowledge management, as a phrase, is falling out of vogue, much like business-process re-engineering or total quality management did, and business intelligence, customer-relationship management, supply-chain management, and enterprise-resource planning will. At best, pertinent concepts derived from these phrases remain, such as increased awareness of the external marketplace and the importance of customer segmentation. Yet in a slow economy, many initiatives associated with these fad phrases are not as easily digested as more entrenched disciplines, especially considering that the former are usually intangible, lack business tradition and often fall to inexperienced managers to implement.
Strict marketing, finance and operations projects are tangible. That is, their value, usually measured in terms of financial return, is directly attributable to the respective project. Intangible projects are marked by their inability to reveal a direct cause-and-effect relationship between investment and net worth. At best, intangible projects are labelled as intuitively tangible, where the value is captured in some form, but rarely in ways that account for extraneous variables. For example, some employees believe that increasing collaboration increases revenue because networking helps people work smarter and more quickly. Here, the assumption is that intangible projects increase revenue, but the reality is that any revenue increases may be due to other factors, like increased sales due to a larger or more aggressive sales force. Employees, and especially managers, who are unable to intuitively accept the value of intangible projects may not adopt them, preferring to digest other projects where a clear return on investment can be demonstrated. Indeed, this unequivocal cause-and-effect relationship for demonstrating ROI is not the only obstacle intangible projects face.
Business tradition and inexperienced management represent two more barriers that prevent the digestion of intangible projects. Regarding the former, marketing, finance and operations disciplines have been in existence for many years, whereas new types of managerial initiatives such as KM have only been around for a relatively short period of time. Numerous books and papers detail success stories regarding more traditional business projects as well as proven techniques on how to implement and sustain them. Few successful organisations exist without employing finance, marketing or operations disciplines; these concepts are core to a business and are not questioned by employees. Projects stemming from these established disciplines have a strong likelihood of being digested by an organisation simply because employees are accustomed to them.
As for the second point, novel intangible projects are routinely passed to traditional line managers to run. These line managers may be experts in their respective fields, as Karen is in HR issues like compensation and recruitment, yet they are typically not experts in issues such as knowledge visibility, capture, retention, diffusion, sharing or replication. Unfortunately, line managers who have not received the benefits of training and experience on how to implement innovative intangible ideas often fall back on their tried-and-tested, tangible project-implementation models and fail to get the intangible project fully digested by the organisation.
As intangible initiatives face additional hurdles, they require a specialised set of organisational digestion factors. It is true, as will be highlighted, that some of these digestion factors are the same for both intangible and more tangible projects. It is difficult to argue that all types of projects, regardless of tangibility, do not benefit from being directly tied to the strategy of the overall organisation, for example. The difference is that intangible projects must contain all of the following suggested factors if they are to be fully digested by the organisation.
Figure 1 – the organisational-digestion model
Day-to-day: engagement method, project plan and project management
Many types of projects require a high-level running structure, but intangible projects require additional rigour given the intense scrutiny they will face. Scepticism exists in every organisation about any project that is innovative and new. The project must continually be justified to multiple parties ranging from the customer, to competing internal project teams, to externally focused lines of business. Adversaries will look for reasons to terminate the project (especially if it competes against their favoured, more tangible initiative) and a good defence is to have rigorous formal structure. It is easier to find fault with a project that may appear ad hoc than a project that is grounded in established methods and documentation. Therefore, an engagement methodology should be formed, revealed to the customer and the identified stakeholders at the beginning of the project, and adhered to as much as possible. A typical engagement method for an intangible project is shown in figure 2.
Figure 2 – the engagement method
A clear engagement method for how the project will operate will decrease customer and stakeholder anxiety by helping these parties understand, up front and without surprises, the project phases required for successful organisational digestion. Related to this is the statement of work that is associated with the ‘agree’ phase. All parties should agree to a statement of work before the project begins, which accurately lists responsibilities and deliverables. This ensures the sponsor, customer and stakeholders formally recognise themselves as such. The more robust the explanations that can be provided up front to all the parties involved, the more they will feel at ease concerning a non-traditional intangible project.
Second, a project plan should be completed for the project. This should include the tasks, staff, budget and schedules required to complete the project in as granular a form as possible. Ideally, the project plan should also contain previously used tools, techniques, lessons learnt, frequently asked questions, expertise contact lists, etc, in order to decrease needless replication and increase re-use of knowledge assets. Writing a comprehensive project plan helps the team and customer view the larger picture of the work ahead while forcing the project team to hypothesise risks, perform a formal risk analysis and account for the risks accordingly. The project plan is a living document that should be referred to frequently and updated as required.
Third, a project manager must actively manage the project and preferably not perform the daily work activities directly related to the project. Once the project team begins working on these activities, it becomes very easy to remain buried inside project-related tasks rather than monitoring the effects that the outside environment is having on the project. As such, the project manager should remain objective, with the ability to apply outside thinking to the goals of the project.
It is critical that people are rewarded, both materially and non-materially, for partaking in the new initiative and that those behaviours being rewarded are directly tied to the desired business outcome. In terms of material rewards, participation will fade in direct correlation to the incentive structure. This is a behaviourally biased point of view, but employees do not do work that they are not remunerated for; similarly, all employees do not respond to the same types of incentives. People need a very good reason to change their behaviour and have to perceive some kind of reward for themselves, their family, their community, etc, especially if they are comfortable performing incumbent behaviours.
For example, if sales staff are rewarded individually for performance of their accustomed daily behaviours and a new project is put in place to alter behaviour, perhaps to increase collaboration among the sales team, any incentive needs to be congruent with this. Altering the incentive to one that rewards employees for their team efforts may help the collaborative initiative. It is important to note, though, that incentives do not have to be materially based. For example, although scientists may respond to monetary rewards they are also motivated by non-material rewards. Alternative rewards may be more appropriate for additional user populations. Similarly, the behaviour being rewarded must be directly connected to the expected outcome. It is critical that the initiative and accompanying reward are in line with the organisation’s revenue model. Many consulting companies, for example, generate revenue by charging for time and materials during their engagements. If employees are asked to increase collaboration in order to share engagement-efficiency methods, and are then rewarded for these efforts, the company is in turn rewarding employees to work better and faster, potentially leading to decreased revenue for the company.
Governance, leadership and roles
Governance for intangible projects is difficult and becomes blurred at times given these projects usually involve cross-functional and cross-project team processes. Without an early identification of the customer and an agreement between the project team and the customer regarding work, it becomes easy for different functions to assume the behavioural responsibility of another party. Organisations that use dotted-line reporting structures may have difficulty deciding upon which roles are responsible and accountable for particular elements of the project. Therefore, assignments need to be fleshed out, clearly defined and accepted throughout the appropriate areas of the organisation.
All levels of management need to support the initiative or it will ultimately fail. Employees sense when top-level support for a project exists and will use cues from their superiors to shape their own opinions and activities. Positive management support translates into positive employee sentiment, which is crucial if bottom-up leadership is also to occur. Essentially, this is when employees take responsibility for the new initiative, use it and propagate its use among their peers. It is important throughout the intangible project to ensure substantial backing thrives from both the top down and from the bottom up and, if it does not, to take corrective action.
The new initiative may or may not require different roles (grouping of responsibilities assigned to individuals) but responsibilities (thoughts and behaviours) will by definition be altered. Any new initiative, unless it directly replaces an earlier solution, immediately disrupts the current method of work by introducing new ways of accomplishing tasks. It is critical that these method changes are identified so that the right people can be assigned to these tasks, and vice versa, appropriately.
Education and training
Never assume a new intangible initiative is intuitive. An education and training programme should be developed early on so that prospective participant in the initiative will understand it once it is launched. Education should not be taken lightly. Employees learn in different ways, often influenced by a sense preference, and require different forms of training. Some people are auditory learners, some are visual, while others are more tactile. To address these different learning needs, training should take the form of one-on-one mentoring, group classroom instruction, books, e-learning, audio CDs, video, or a combination thereof. Given the many options, education vehicles should be analysed and selected, and education topics should be incorporated into the ongoing meetings of the project team, right from the beginning of the project. Education should not be an afterthought, but conceptualised and planned simultaneously with the intangible initiative’s project planning. In sum, having the intangible initiative ready for launch will be meaningless if the appropriate training programme is not there to accompany it.
Strategy, mission, vision, goals, objectives and tactics
It is critical that a company’s mission is linked to the required vision, goals, objectives and tactics needed to fulfil it. Although not mutually, exclusive these words have different meanings. The mission is the overall aim of the company, such as ‘produce picture frames’. The vision articulates the desired state of the company. ‘Increasing internal collaboration and networking’ is rarely a vision given that is usually not the specific aim of a company. Rather, the aim of a company is represented in a statement more like ‘become the leader in the production of standard picture frames’. Increasing internal collaboration and networking is merely an enabler of the true vision of the company and becomes operational only after a tactical project is secured. Goals are the delineated aims of the company. In this example, a goal may be ‘increase simultaneous processes and reduce bottlenecks in production’. Objectives are what the company wants to accomplish and by when; quantifiable and time bounded. Tactics are specific operations proposed to meet the objectives, assigned to roles, implemented, executed and measured. Most intangible projects are tactics.
Many intangible initiatives have a technological component. Technology does not have to be the main focus but, if for nothing other than scalability, technology can be a useful vehicle. The largest room for errors exists when the recommended technology initiative does not naturally conform to how people are accustomed to completing their work. That is, the recommended technological components should fit well within other existing technological components from technology, people and process standpoints.
If employees are accustomed to using a particular word-processing system, suggesting changing this system merely because the new intangible initiative works better with a different system may cause unnecessary disruption. In fact, asking employees to perform a different process is often the more difficult hurdle to cross. For example, do you sit in the same seat in your conference room for every meeting? Do you drive the same route to work everyday? Do you tend to buy the same brand of beer every time you go to the store? The point is that people become comfortable with choices they have made in the past. As such, any new technology should gradually merge with what employees are accustomed to doing.
Interconnection, marketing and teaming
The term ‘interconnection’ refers to the development of partnerships outside the team immediately responsible for the intangible project. It is vital that such initiatives are not perceived as having come from one group within the organisation; rather they should be seen as a change that is owned and propagated throughout the entire company. In addition, in a matrix organisation, where authority often becomes blurred, people act more on what they believe is right and less because of what superiors are dictating. In order to counter these potential obstacles, strong partnerships need to be formed throughout the organisation. Although good internal marketing helps with this, it may not be enough. Actively targeting other groups, especially across functions, divisions, lines of business, and so on, and encouraging these groups to become part of the design, development and implementation of the new initiative is critical if organisational digestion is to occur.
A customer and stakeholder marketing plan needs to be developed when institutionalising intangible initiatives. First, customers and stakeholders need to be identified via a formalised analytical process. Subsequently, there are a number of key questions to answer:
- What is the message?
- What information do recipients need?
- What information do recipients respond positively/negatively to?
- What are the best ways to convey the information?
- Where are the best places to convey the information?
- When should the information be available?
- How will feedback be received to see if the message has been accepted/rejected/understood?
The final marketing plan should then outline tactics that help direct and manage customer and stakeholder expectations.
‘Teaming’ refers to the internal team responsible for implementing the intangible initiative. The importance of internal teamwork cannot be overstated. This topic has been covered extensively in the past; in particular, readers are advised to pay close attention to the Drexler/Sibbet Team Performance Model. Although humans are innately social beings, good teamwork is not necessarily a natural phenomenon. If the organisation does not offer team performance training, it is perhaps worth considering developing a programme for this and seeking external training prior to programme implementation.
The process for using an intangible initiative should be aligned with those of existing initiatives (both tangible and intangible) and should not have to compete with them. The process should be made explicit through the development of process flows, accompanying guides and training, and then embedded into daily ritual work tasks. The intangible initiative should not be treated as a distinct process altogether. For example, if the goal is to increase collaboration among sales staff via lessons-learnt events, the collaborative events must fit naturally within the normal routine that sales staff follow. If, for instance, the sales staff meet face to face every six months to learn about new trends in their industry, a lessons-learnt event would be a natural fit within this meeting. Conversely, if the sales staff always works virtually and independently, an in-person lessons-learnt event may disrupt the natural order of sales activities.
Norms and culture
Organisations, and the employees within them, have ingrained ways of behaving, customs and beliefs. These commonly held thoughts, feelings and behaviours gradually take root throughout an organisation’s existence and, therefore, in order for change to occur, they must gradually be uprooted. Just as an obese gentleman who became that way through years of poor eating cannot shed all of his excess weight in a matter of days, an organisation requires time to change. I have already spoken at length about the importance of gradual changes. Although this notion holds true, one way to expedite change is through a systems-theory technique. For instance, if there is suspicion of a negative repetitive pattern in work behaviour, map out the behavioural descriptions until it forms a repetitive circle as shown in figure 3.
Figure 3 – the behavioural cognitive emotive circle
Next, select areas in which it would be easiest to break the cycle. In the case illustrated in figure 3, for example, there are a number of obvious points where intervening initiatives could achieve this. For instance, once the order for 200 picture frames arrives in the company, simultaneously sending the order to both upper-left and right-corner assembly experts, instead of solely to the upper-left-corner experts, may enable all the experts to detect the adhesion problem at the same time, fix it and expedite the production process. Alternatively, the firm could implement a collaborative initiative whereby whenever the upper-left-corner assembly experts are done with their task they meet with the upper-right-corner assembly experts to talk about lessons learnt. Although some of these changes may seem like quick-fix solutions, often the most significant changes can be made when entrenched viewpoints are explicitly articulated in a very simplistic way. In figure 3, I have separated the more difficult inner emotive ring from the outer behaviour ring. But here, too, significant changes can occur when the ‘dead moose under the table’ is made explicit and thoughtfully addressed.
In sum, then, difficulty demonstrating a direct cause-and-effect relationship, entrenched business traditions and inexperienced management all represent significant obstacles when attempting to institutionalise intangible projects. Nevertheless, organisational digestion is possible, providing you follow the basic principles outlined in this article.
Jason Slusher is currently a senior manager at a large pharmaceutical corporation. He can be contacted at firstname.lastname@example.org.