September 18, 2005

De-emphasizing KM in business is a big mistake. Yes, but for whom?

Posted at 19:26 in knowledge-conscious management.

Why Knowledge Management is so important from Dave Pollard is really an interesting post. I fully agree with Dave's conclusion that "the current de-emphasizing of Knowledge Management is a tragic mistake". I have been wondering in the last two years why so many interesting KM initiatives of the late 90's finally ended up nowhere, in spite of evidence that they did create substantial value for the firm. Dave gives a few reasons why business leaders and KM leaders have such a hard time understanding each other. Though I don't really buy the short term vs. long term argument - Some KM initiatives indeed show very short-term results in terms of new capabilities and new business - I fully agree with his claim that the "vertical" view of the industrial age firm according to which managers think and decide whereas employees execute and give feedback is the major cultural obstacle

Business leaders are accustomed to knowledge being transferred top-down (instruction and formal training programs) and information for decision-making being polled from the front lines (...)Business leaders see their leadership role as critical to the organization's success; their frame of understanding is hierarchical -- they tend to believe that knowledge and value increases with experience and that rewards should go disproportionately to identified superstars and up-and-coming leadership candidates. KM leaders see contribution to organizational success as more egalitarian, and are more likely to believe (as Drucker says) that almost every employee today knows how to do his/her particular job better than anyone else (including the boss) -- they may see large wage and reward disparities as demotivating and unwarranted.
What is frightening is to find so many similarities between our large industrial multi-layered organizations and the former Soviet Union, which proved totally incapable of modernizing itself and eventually collapsed. In one of his books I read a few years ago, Mikhaïl Gorbatchev wrote that one of his big mistake was to try to introduce elections in the communist party for some key positions at the local level, instead of assigning them from the top down. He didn't anticipate such a high level of resistance to change. According to him, the reason is that the type of people who win elections and those who succeed in a bureaucracy are from two different worlds.

Maybe what is happening in big organizations is more or less the same. Why would business leaders want to introduce powerful networks and communities inside their organizations if all end up challenging the "normal" way of doing business that made them successful in the first place? I now tend to think that KM methods and tools will first be experienced at the personal level (phase 1), then in small companies and within alliances of small companies (phase 2) and then in large companies when they start loosing business to small companies (phase 3).

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