Today I talked at ZF Live about Knowledge Management and Virtual Teams Management. The show was triggered by an online training I have delivered for Mediafax Group which was recently launched. The training is available at www.zfelearning.ro and you may find the recording of the TV show below (NB: both of them are in Romanian only):
When we talk about innovation it’s easy to come up with the iPad example but the product itself is only one side of the story. We’re just looking at the tip of an iceberg. Have you ever wondered what’s below the sea? Let’s take a few moments to see how this innovation world looks like.
In the beginning there was darkness
Do you remember the first verses of the Bible? What happened in the darkness when our universe, the most amazing innovation, started to exist? It is written that “God said”. Whatever darkness you may face, you will never get out of it if you do not start to communicate. Communication is where it all begins.
Being innovative is not a statement or a nice attachment to your logo. It’s a long-term and continuous process. We are challenged to create the business of tomorrow even as we focus on keeping the organisation lean today, with more immediate incremental improvements supplemented by long-term big bets.
The key for this process is to enable connections between people and ideas. The tools we now have available are supporting communication more than ever. When you’ve read the word “connections”, your mind probably jumped to social tools such as Facebook, Google+, or Twitter. Indeed, businesses generally consider how to take advantage of these or similar web tools to communicate inside and outside the firm: enabling employee knowledge sharing, providing customer support, building the brand, or marketing products and services.
PwC recently launched the “Global Innovation Survey”, the largest and most comprehensive study of its kind exploring innovation from a global, multi-sector perspective. It uncovers insights obtained from interviews with board-level executives from 1,757 companies, across more than 25 countries and 30 sectors, who are responsible for overseeing innovation within their company.
The study shows that the most innovative companies use social media more often to collaborate externally and support the innovation process: 67% (most innovative companies) vs. 39% (least innovative companies) and they are more likely to manage innovation efforts formally or in a structured way: 78% vs. 66%. Moreover, when it comes to developing new products and services with external partners, the most innovative companies collaborate over three times more often.
The importance of collaboration can also be seen in the number of companies that are now working with customers or other businesses to co-create new products and solutions. The rapid upsurge in the sale of e-readers and e-books is a good example of how these collaborations can create game changing opportunities for some businesses and the threat of marginalisation for slower moving competitors.
Starting to communicate is not a requirement for innovation staff only but an innovative culture is required. Seven in ten of the executives interviewed by PwC also feel that a successful innovation culture relies on the organisation’s ability to foster an environment where smart exploration is encouraged even if does not always lead to a successful outcome. Leaders know that breakthrough innovations require exploration of entirely new types of business models and technologies. Sometimes, the experiments do not provide the expected results. Sometimes called a failure, those unexpected results are valuable discoveries that can guide the innovation team to bigger and better outcomes.
More lights in the sky
As we go deeper into creation we see that during the fourth day God made the stars to shine on the earth. Have you ever wondered why would we need stars since we already have light from the sun? Aren’t stars redundant lighting?
As companies begin to experiment and have success with social collaboration tools, they will begin to understand what we call the collaboration paradox: adding more information to the mix (so called “social information”) actually can help companies combat info overload by creating additional context that makes it easy to find exactly what you need.
The navigation techniques have always used stars as guidance on the ocean. We use “interest graphs” (maps of topics, ideas, or business issues and how they’re interrelated) to make it possible for individuals to navigate through our own oceans of information.
Effective innovators have structures and practices in place to make innovation more systematic. This allows them to “control” accidental discoveries, and to be continuous innovators. Such structures include a grassroots approach – empowering employees to act like entrepreneurs – as well as strong leadership backing and centralised support.
The leading innovators in PwC’s survey have clear preferences for a more structured innovation approach. Only a fifth (21%) of the most innovative companies manage innovation informally, compared with a third (32%) of the least innovative companies. In order to get the leading lights in the ocean of innovations, many leaders are shifting away from total reliance on informal structures.
Why would a creator empower creation? We see fruitfulness as one of God’s requirements even for land and sea. Why would we require innovation at all levels? Well, especially in the knowledge days there is simply no other way.
A clear indication of innovation’s move into the mainstream is that many companies now expect staff to allocate at least some of their time to developing and supporting new ideas, rather than simply relying on a few bright sparks. Many participants talked about the need “to empower frontline staff”. The fact that talent is quite low down the list would further underline the move from innovation being “alchemy” by the few to “cookery” by the many.
While in the past R&D units would have focused on ways to enhance the product range, the PwC survey shows that many CEOs are looking to go much further by transforming what they sell and how they sell it. A soap powder manufacturer might open up a chain of launderettes or an engine maker could move from selling engines to charging users for running them, for example. What brings these new business models together is a shift in focus from products to solutions. The product is clearly an important part of the solution, but not everything. In turn, the role of technology goes beyond creating new and improved products towards gaining sharper insights into what customers want and how to deliver it. A common thread in the feedback from participants was the need “to spend more time in the marketplace”.
The most successful companies have gone further in seeking to create a culture of innovation. However, in keeping with innovation’s changing risk/reward profile this includes giving people extra time to create and nurture opportunities and being prepared to tolerate a level of risk and failure.
The turning point
The beautiful creation days have met a turning point and its effects are still here today. Why? Because there was a disruption between the knowledge Adam and Eve had and the way they decided to act. Interrupting critical knowledge in the decision making process is the turning point where most beautiful stories have ended tragically.
Some years ago I began to work on “capitalizing” knowledge in PwC for the EMEIA region, which is a territory covering all offices from the northern countries to South Africa and from the UK to India. This made me look with great interest on the efficiency of information flow and I realised that organizations that have dysfunctional knowledge management begin to suffer the same effects that the Alzheimer disease has on human brain: intellectual abilities are lost, even reach inability to think abstractly, the coordination is limited, and they have trouble performing daily activities. As a result, innovation becomes increasingly rare till it disappears completely.
Since its evolution is similar to an organization’s brain, in an article I wrote last year, I named this disease “Knowledgeheimer”. Thinking about an organization as a patient appeared to be making more sense to me when dealing with knowledge management. “Knowledgeheimer” is the turning point that burns a beautiful story into ashes.
In 1991, Knowledgeheimer’s treatment involved maximizing the organization’s intangible assets. Later, however, innovation was in the forefront of concerns – materialised into projects like Skandia Future Centre, a prototype to test the operation of new methods of capitalization of knowledge and, in particular, human intelligence within the organization. The basic principle was to stimulate new ideas and creative processes.
Today it becomes more obvious that establishing and fostering an innovative culture is a subtle mix of encouraging the right behaviours and giving people the means to take ownership of their innovation efforts. The Innovation Survey offers a glimpse of how this mix would look like.
Just as with Alzheimer’s, to combat “Knowledgeheimer”, the organization’s brain should be looked at consistently and intentionally, in a pro-active manner. Access to knowledge retention and taking benefit of this knowledge has to become part of the daily workflow.
Article published by Romanian Business Digest, October 2013; PDF copy here.
For some years I’m coordinating an international team spread out in Europe, Middle East and India. Cultural differences, dissimilar time-zones and communication difficulties due to jarring accent of the English language are all granted. However, the major challenge does not appear here, nor in terms of technology, but rather in the area of personal motivation. I wrote a piece of article on managing a virtual team for HR Magazine which you can find online here. A copy of the printed version is here.
Unfortunately it is only in Romanian so my apologizes for my English readers. I’ll more likely come back with this subject at a later time.
Ford’s production lines have marked a turning point in human history. Business had to change and whoever did not understand the need for automation and series production was to be crushed by industrialization itself. After nearly 100 years, Skandia marked the official beginning of “the knowledge era”: Leif Edvinson was hired in the early 90’s as a CKO (Chief Knowledge Officer) in order to capitalize intangible assets of the organization. At Skandia’s size, it was obvious that there were a lot of resources wasted and they spent a lot of time “reinventing the wheel” rather than facilitating transfer of expertise, innovation, lessons learned – in a word, knowledge.
Two years ago I began to work on “capitalizing” knowledge in a territory stretching from northern countries to South Africa and from UK to India which made me look with great interest on this topic. I found that knowledge management is perceived differently from one company to another (with some elements in common) and what works in some parts of the world as formal structure has no relevance in another cultural environment. Also, the literature is divided, sometimes the KM (knowledge management) function being located in the organizational chart somewhere similar to internal audit, sometimes subordinating it to the CEO, Business Development or, in early literature, integrated or confused with IT.
Out of the box
Only after I began to think “out of the box”, I understood that knowledge management comes in fact to maintain the organization’s brain, to keep it active, to develop it so the organization is able to work and innovate. Organizations that have dysfunctional knowledge management begin to suffer the same effects that the Alzheimer disease has on human brain: intellectual abilities are lost, even reach inability to think abstractly, the coordination is limited, and they have trouble performing daily activities. As a result initiatives become increasingly rare till they disappear completely.
Since the evolution is similar to an organization’s brain, I named this disease Knowledgeheimer. Thinking about an organization as a patient appeared to be making more sense to me when dealing with knowledge management. Knowledgeheimer allowed me to identify knowledge management problems without being limited by structures, tools and frameworks.
Organizations can live longer than people who created them, and the disappearance of founders should not bankrupt the companies they founded. The most important condition to avoid such major danger is a healthy organisational brain that leads to effective coordination and the capacity to constantly adapt the business to the realities of the time. As organizations grow, the “brain” is no longer a person or a group, but rather the result of collective intelligence.
Knowledgeheimer is very sensitive to some risk factors and advanced age is one of them. However, Knowledgeheimer is not necessarily installed due to the passage of time, but to the inability to utilize and share knowledge. Organizations can stay young as long as they keep an active brain, responsive to internal and external stimuli.
Although they do not solve the problem, investments in distribution systems and retention of information, collaboration platforms within the organization and between organizations and customers are a turning point. Without them, Knowledgeheimer is already installed. However, creating an organizational culture that encourages knowledge sharing and teamwork is the essential driver so that investment in technology is not in vain.
Any organization needs information from external sources as no one has complete ownership of all the knowledge in this world. Lack of access to external information sources and lack of an external performance assessment is also one of the causes of Knowledgeheimer. The effect is breaking out of reality which leads to schizoid behaviour and functional retardation.
Prevention and treatment. About Steve Jobs’ toilets.
In 1991, Knowledgeheimer’s treatment involved maximizing the organization’s intangible assets. Later, however, innovation was in the forefront of concerns – materialised into projects like Skandia Future Centre, a prototype to test the operation of new methods of capitalization of knowledge and, in particular, human intelligence within the organization. The basic principle was to stimulate new ideas and creative processes. This successful project was then replicated by the Ministry of Finance in Denmark with what they called “Mindlab”. However, as I said, the need for specific medications leads to the need of each organization to open its own lab.
Sometimes treatment methods relate to patients’ creativity. For instance, Steve Jobs has been criticized by employees that he moved water dispensers and toilets in the middle of the building. In this way, each of them was forced to get out of their own perimeter. Discussions from the water dispenser often end with views of company processes and products. This soon led to an informal environment for expression of collective intelligence.
Just as with Alzheimer’s, to combat Knowledgeheimer, the organization’s brain should be looked at consistently and intentionally, in a pro-active manner. Access to knowledge retention and its capitalization should be part of the daily workflow.
A look into the future
I’m reluctant to “one size fits all” when it comes to knowledge management. I believe in the individuality of each organization and believe that a keyword for the future of knowledge management is “creativity”. Approaches will have to be creative, even if they are based on similar tools: databases, networking platforms, expertise location, or collaboration systems for communities of practice. Knowledgeheimer is already the most common form of organisational dysfunction and, if not treated properly, worsens as it progresses, eventually leading to death. As we become more and more knowledge-driven societies, its incidence is increasing from year to year.
Article published by Money Magazine, July 2012 edition. Click here for the original printed version.
For a long time, in Romania there was no research on lobbying. Each public speach would refer to what people want or see lobbying and each lobbyist would strongly affirm that there is not much lobbying undergone in this country. However, some questions arise:
- Do all these assumptions have any support in reality?
- Do people make the distinction between lobby and traffic of influence?
- Which are the most efficient lobbying tools?
- How many actors are there lobbying?
This is why a research was needed and answers are given – you may download:
- “Lobbying in Romania” 2012 – the English version
- “Lobby în România” 2012 – versiunea în limba română
Companies are cutting costs all over the world but only a few say their cost-cutting programs were successful over a three years period.
Why did they fail? You may find some answers in the article bellow (Romanian only):
Almost 90% of worldwide executives made cost cuts during 2009, a percentage that is not surprising at all considering the economic downturn. However, according to PwC’s “2010 Global CEOs Survey”, almost 80% of executives realised that they need long term results, not just short term liquidity.
What does this have to do with Aristotle? You may find the answer in the article bellow published in the last issue of “Capital” (Romanian only):
Last year I published an article in Forbes where I stated that the next step lobbyists are going to take in Romania, in order to avoid a lobbying law, will be to announce a self regulation initiative. Recently, during a conference dedicated to assessing the opportunity of a lobbying law in Romania, one of the lobbyists publicly announced that a voluntary registry of lobbying activities is going to be open by lobbyists themselves.
How will this make lobbying more transparent and why do lobbyists prefer self regulation instead of a law with similar conditions?
Possible answers in the attached article (Romanian only). Download a PDF version from here.
A possible answer may be found in the article bellow which I wrote for the last issue of Forbes. The article aims to look for reasons of the sharp raise in international corruption cases compared to the global downturn trail. References are made to SFO’s investigation of British Aerospace (BAE) as well as several corruption surveys and FCPA analysis.
PDF version available at the link bellow (Romanian version only):
“International fraud, corruption and the economic crisis”, Forbes Romania Nr. 24, 8-19 February 2010, 80-81
Romanian readers may find useful the following resource on the subject of lobbying:
Commissioner Siim Kallas announced considers as a great success the fact that 2,100 lobbyists voluntarily registered themselves in the EC’s “Register of interest groups”. Is this the case?
A possible answer as well as an analysis of what lobbyists self regulation may bring to improving transparency in Romania can be found in an article I wrote for Forbes Romania (available in Romanian only):
“Who benefits of lobbying self regulation?”, Forbes Romania No. 20, 14-27 December 2009