||The Emerging Community of Knowledge
By Debra M. Amidon
Conventional wisdom tells us that most companies capitalize on only a small fraction of their knowledge assets. But where are these wellsprings of knowledge and innovation located? Where do we find these sources of tremendous hidden wealth? John Seely Brown, the insightful director of Xerox Corp.s Palo Alto Research Center (PARC) suggests we begin by examining what he calls "communities of practice".
"At the simplest level, they are a small group of people whove worked together over a period of time not a team, not a task force, not necessarily an authorized or identified group," explains Brown. "They are peers in the execution of real work. What holds them together is a common sense of purpose and a real need to know what the other knows."
Brown and the leaders at the Institute for Research on Learning (IRL), a PARC spin-off, have been describing communities of practice for many years. Likely an outgrowth of the quality circles and the evolution of networked/learning organizations, this concept represents a way of making explicit a companys untapped brainpower, creativity and potential. These communities can become centers of expertise which can be highly leveraged in an organization prepared to capitalize upon economic change and unexpected business opportunities.
After years of research in a variety of industries and on several continents, some modern managerial principles are emerging. It doesnt matter where companies begin (e.g., quality, reengineering, benchmarking, systems thinking, learning networks, restructuring, etc.) But there needs to be one compelling force which binds the entire organization togetherone that creates a common language and shared purpose. Leadership must come from the top-down, bottom-up and middle-out. In other words, everyone has ownership.
For many organizations, the binding force has been one of change management. Its certainly true that the only constant today is the accelerating rate of change. Many CEOs have been successful in mobilizing their organizations to accept and even embrace change as a way of doing business. The way they phrase the challenge is inspiring and people are encouragedand even rewardedfor doing things differently.
More often than not, however, change management strategies have been met with covert tactics which undermine long-term progress. Moreover, people are not inclined to share their ideas and expertise with others if they feel that their own jobs are in jeopardy. In 1996, a New York Times survey reported that only 20% of workers cooperate with others more than they have in the past. This comes at precisely the same time when collaboration across multiple boundaries is fundamental to business success. Employees often provide managers what they want to hear, not necessarily the solutions which could provide breakthrough results.
How do you set in motion the processes and practices which will bring about extraordinary growth in the uncertain future? The answer is in innovation strategy, not change management.
Imagine for a moment that you are the recipient of these words: YOU must change. You MUST change. You must CHANGE! The normal reaction is one of being in jeopardy, feelings of inadequacy and resistance to the degree of change necessary.
But the reaction is quite different when the driving organizational imperative is innovation. People generally react to calls for innovation with genuine enthusiasm. They begin to seize on a vision of real progress and think about how their competencies can be applied to their objectives.
The difference between these two wordschange and innovatemay seem insignificant. However, if you are seeking the binding force to catapult your organization forward, which would you choose? It is the difference between being hit over the head with a hammer or having the wind put at your back. It is the difference between being threatened or inspired.
Convergence of Perspective
As the focus of the corporation begins to shift from change to innovation, we will witness the transformation of every function and sector of the economy. If you were to attend the professional meeting of one function or discipline and not know the sponsoring organization, you may be hard pressed to determine the primary focus. The programsand even many of the presentersare extremely similar. There is a realizationand respect foralternative paradigms which did not exist only a decade ago. Many of these professions appear to have one agenda in common: to understand and optimize the learning capacity of an enterprise in order to enable a more optimal creation and application of new knowledge (i.e. the process of innovation).
The traditional view of communities of practice is defined as evolving learning networks which develop over time and create added value through a shared mission. They may be perceived as professional societies (in fact, new societies and organizations have evolved from them) or they may represent collections of people who transcend any individual discipline, society or profession.
If the future belongs to those who are able to transform boundaries, then participants in these communities of practice may represent the leadership of tomorrow. There are at least ten of these functional areastraditional and newwhich are contributing to the emerging community of knowledge practice. Among them: Finance; Human Resources; Quality; Information Technology; R&D; Engineering; Manufacturing; Marketing/Planning; Sales/Services; Alliances/Joint ventures.
New networks are forming daily with the enabling communications technology for intranets and cyberspace. As employees at every level begin to discover that there is more value in creating and applying new ideas than there is in clutching to successes of the past, these collections of expertise will proliferate and grow more influential.
For our purpose, we will use a simplified description of mission for the community of knowledge practice: harnessing complementary competencies with a shared purpose toward a common strategic vision. Let us take a cursory view of each of these dimensions and the recent changes which characterize their individual evolution. It is the collective changes which constitute the fundamental transformation underway. Hardly a function, discipline, sector or industry organization is not affected in some significant way.
Finance: The name of the game is performance. All organizations are struggling to deliver more with few resourcesfinancial, human and technical. Unfortunately, conventional performance measures are inadequate. Existing data typically doesnt take into account an enterprises intangible assets, such as knowledge capital, social capital, learning capital and the like.
The profession is responding, however. We are beginning to see efforts to account for intangiblesand such efforts will gain credibility over time. In an environment where market values can exceed book values by multiples of ten or more, there is a tremendous need to make intangibles tangible. The key challenge todays financial professional faces has become one of accounting for the flow of ideas, knowledge and innovation practices.
Human Resources: HR professionals have focused on people. Initially, it was a matter of ensuring that the right people with the right skills were in the right position at the right time to guarantee business success. But, managing such an intricate process of individual and corporate development is not small task. When it was realized that such expertise was necessary in order to create competitive advantage, executive leadership took notice of the challenge to be addressed.
What has emerged is a new focus on learning, leadership, the role of corporate culture and the value of cross-boundary interaction. The behavioral implications of business success became paramount with the emergence of networked organizations, cross-cultural diversity and the new style of management which was less hierarchical and more process-driven.
Response in the profession has been one of research in the learning process, institutes for human dynamics, centers for leadership development, career development tools and a dedication to values, behavior and results. In each of these areas, it ahs been the contribution from other functions and/or disciplines which has enhanced the capability of the human resource function itself.
Quality: The (re)discovery of the importance of quality in products and services has provided all organizationsprofit and not-for-profitan enterprise-wide common agenda. Originating in the manufacturing community, the value of quality circles, statistical process control and just-in-time methodologies swiftly spread through organizations. Industry pressures and new forms of recognition, such as the Baldrige Award, provided incentives to reach carefully defined standards.
The concept of benchmarking best practices is a major contribution to the field. Executives began to look across industry boundaries for examples of exemplary processes. What began as a manufacturing focus quickly spread through every organization within the enterprise as well as the links with suppliers. The quality process transformed into the innovation process in which reduced cycle-time, organizational change, market positioning and customer interaction were essential.
Information Technology: Perhaps no function has undergone more radical transformation than those responsible for technical infrastructure. The profession has witnessed an explosion in advancements of technology as well as growing responsibilities within the organization.
Internally, former information technology managers are finding themselves cast as knowledge managers. Their technical responsibilities are miniscule in comparison to their need to understand business strategy, learning mechanisms and the overall organizational infrastructure. For many companies, what has emerged is a network of professionals with varied backgrounds who share a common purpose in the organization and beyond.
R&D/Technology Transfer: The function which previously maintained primary authority for innovation was the R&D community. Whether discussing invention or innovation, the research officers held the responsibility. As the distinction between invention and the full commercialization process occurred, some progressive managers assumed responsibilities which reflected both research and business developmentthe vertical and horizontal responsibilities for the entire innovation process.
The technology transfer specialty was developed to optimize the flow of technology into and within the corporation. Once it was clear that the process could not be left to serendipity, the field of knowledge management emerged as a new discipline with its own professional societies, advanced degree programs and the founding of national and international centers for research and commercialization, bridging the diversebut commonneeds of government, industry and academe.
Ultimately, these processes of innovation will operate as self-managing systems and virtual learning networks which ensure continuous economic growth at every level. The agenda is one of transformation, not transfer.
Engineering: Cross-functional management may have been first demonstrated in initiatives such as concurrent engineering and simultaneous development processes. Review of these progressive management approaches reveals that they may be innovation initiatives by another name. In order to effectively develop products, engineering managers realized that there was knowledge resident within the other sectors which was required for success. Most of the product development costs can be avoided if the information is known from the beginning and built into the design phase.
As a profession, engineering addressed the issues of availability of knowledge and know-how in a future workforce. The National Academy of Engineering and societies in the engineering professions (e.g. the American Association of Engineering Education, IEEE, ACM, et al) created the National Congress on Engineering Education, the first of its kind to identify the key issues in the profession and potential strategies. The task forces provided opportunities across functional, sector and industry boundaries leading to a greater understanding of one anothers competencies.
Manufacturing: The integration of technology-push and market-pull (i.e. supply/demand, needs/seeds) ultimately come together in the manufacturing functionor the translation phase of the process of innovation. With intensified global competition and the proliferation of companies which excelled at commercializing technology, the production aspects of goods and services became paramount.
Previously relegated to third-class citizenry in the corporate worldand in the professional schemamanufacturing engineers were put to the test. Not only were they able to display their prowess with statistical analysis, they were the first to embrace the quality agenda. This enabled them to provide corporate leadership in team-building as well as with customer interaction. The Next Generation Manufacturing (NGM) Project, coordinated through the Agility Forum, even includes an imperative paper for the innovation process.
Marketing/Planning: If R&D has historically been responsible for innovation in the invention phase of the process, Marketing has been responsible for the commercialization phase. In this respect, business development has been the domain of market research professionals. With markets forming and reforming at a blistering pace, the role has increased over time.
The new orientation is one of leveraging competencies to meet the unarticulated needs of customers and unserved markets. Marketing professionals have realized the value of innovating with the customer as a way to differentiate themselves from the competition and leverage distinct competencies.
This shift has been from a focus on plans to the enterprise-wide innovation process itself. This revised charter, together with the uncertainties of the economy, demands knowledge from all functions, business units and geographies in order to develop an effective enterprise leadership strategy. There is a new appreciation of competitive intelligenceand in some instances, collaborative intelligence. How does one develop a rationale and business plan for a market that doesnt exist today but is likely to form overnight? Traditional mechanisms and metrics will not suffice.
Sales/Services: The services sector has become the fastest growing sector of economies around the worlds as a percentage of GNP. At the same time, the services function within the manufacturing sector has become an integral part of the innovation system since such professionals are the closest to the customer. However, sales and service personnel increasingly rely upon knowledge and expertise from several other functional competencies (e.g. R&D, engineering, manufacturing, et al) in the organization in order to make the sale.
As modern concepts of customer partnering (and new technologies than enhance relationships) evolve, the role of the sales and service function will change dramatically. Instead of being at the end of the value-chain, they will be portrayed as the lead agents for learning from the customers and feeding that insight back through the innovation processes of the company.
Alliances/Joint Ventures: The newest function in the innovation spectrum, managers of corporate alliances have been established as a necessity in an era of collaborative strategy. No longer can organizations manage the economic dynamics alone. There are many who believe that in the future, markets will revolve around sets of competing alliances.
A respect for complementary competencies must exist within and throughout the strategic business network in order to optimize results. The dynamics of the marketplace are likely to place a premium on the successful exchange of expertise across corporate borders (e.g. outsourcing, joint marketing, shared distribution systems, etc.)
This is the rich expertise available as you chart an innovation course forward. All that is left to do is bring together those diverse perspectives and leverage the complementary expertise of your leadership team.
Innovation strategy may be the one way to create a simple solution amidst all the complexity. Every function has undergone dramatic change over the past few yearsas a function, as a profession and as a collection of expertise across traditional boundaries. Each has learned from the other and contributed to their body of knowledge. Individual communities of practice have evolved on virtually every topic imaginable. It is this cross-boundary sharing and learning which is accelerating the momentum of progress. This is precisely the reason that the knowledge movement is fundamentalnot a fad.
Only a few years ago, the fortresses between the functions were often impenetrable. Today, we see the emergence of the collaborative enterprise (as well as cross industry collaboration)marshalling the talents of people throughout the organization to create and move ideas.
They have discovered the value of their complementary competencies and how they contribute to the whole. They are all active participants in this rapidly maturing community of knowledge practice.
This article first appeared in Knowledge Inc.s Executive Report on Knowledge, Technology and Performance, March 1997 Issue and is adapted from the book Innovation Strategy for the Knowledge Economy: The Ken Awakening.
1996-1999 ENTOVATION® International. All rights reserved.