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Conversations
with Debra M. Amidon The contents of these discussions, enhanced with numerous supporting charts and diagrams, have been published through Amazon.com as an online downloadable ENTOVATION Architectural Primer. Go to the ENTOVATION web site for ordering instructions.
Editor's note: This is the third in a three-part series synthesizing the knowledge gained during the tenure of Debra M. Amidon as guest moderator for the AOK Knowledge Architecture/Structure Discussion Group in February, 2001. It is part of the AOK Star Series which brings leading leaders in knowledge enterprise to the AOK table. Debra was asked to address in broad terms the structuring of knowledge management.
is with the permission of Debra M. Amidon and remains protected. Debra Amidon: First, we have had a discussion about the "why" of architecture - the rationale behind considering management from a systematic perspective rather than leaving it to serendipity. We explored the New Knowledge Value Proposition - Economics, Behavior and Technology. We also began to consider the implications of the Knowledge Economy from all 3 economic levels - the success of an enterprise (i.e., micro-economic), the vitality of a nation's economy (i.e., the meso-economic) and the advancement of society-as-a-whole (i.e., macro-economic). Second, we explored the "what" of an architecture - the 5 elements that were researched in 1989 by Digital Equipment Corporation: Knowledge Economics, Knowledge Structures, Knowledge Workers, Knowledge processes and Knowledge Processing Technology. Each area was described with a set of questions that could be used to initiate a discussion with senior level management. But knowing all there is to know about these elements does not ensure implementation. Third, and for the
rest of this week, we will consider the "how"
of knowledge strategy - how knowledge is created, how knowledge
is converted in products and services and how knowledge is commercialized
to provide value to customers, stakeholders and/or other members
of a given constituency. For this, we explore the innovation
process, some of which has already been The first step for
an effective innovation strategy is to make the process Sources of innovation
vary greatly. Some studies replace the
Based upon several years of management systems research and application of core concepts in a variety of academic, industrial and government settings, the following ten dimensions of management strategy have emerged as an excellent way to calibrate an organizations capacity to innovate.
Each of these domains are often managed in isolation - often with their own language, priorities and practices. For instance, there is often little respect found between the finance, human resource and information technology organizations. These functions and business units often compete for limited resources through the budgeting process without a coherent sense of purpose and vision. The results lead to fragmentation, unnecessary duplication, conflict, and underutilized competencies. What is needed is a dialogue among the principals of the organizations - across functions, business units and managerial levels. An administrative tool is needed to stimulate the strategy formulation process with a focus on the managerial aspects of the firm - not only the financial or technological elements. Remember that all three must be in balance for optimal leverage. Similarly, business units will compete for resources and not collaborate on their own relative strengths and weaknesses to optimize the results of the organization. Those that do not succeed are vulnerable to being amputated. Unfortunately, the business planning focus to-date - with its primary foci on finances, products and markets - intensified the competition so some business units compete for the same customers.
How can one get started? In Chapter 7 & 8 of Innovation Strategy for the Knowledge Economy, there is an assessment of 70 questions along ten dimensions. A Knowledge Innovation Litmus Test that has been published in several languages, can be used to calibrate the innovation capability of a given organization. Using this as a dialogue tool, participants will gain a clearer understanding of the complementary competencies that can and must be brought to bear:
If seven out of ten questions were answered in the affirmative, it is likely the organization has a good handle on the innovation process and knows how to create an environment for the optimal flow of ideas contributing to the viability of the enterprise. Primarily negative responses to these basic innovation questions should drive an organization to examine its processes for bringing ideas to market and leveraging intellectual capability into the future. Whatever the results, the questions can frame an innovation dialogue. Behind each of these 10 dimensions are many questions that relate to a given company or industry. If you use a rating scale, say 1-10 on how well the enterprise is doing, inevitably there will be significant differences of opinion. The importance is not in answering a yes or no or even a particular rating. The rationale behind the answer is of most value. From the resultant dialogue, innovative strategies will emerge. This way, executives can tap into the tacit knowledge of employees - thus widening the knowledge base from which business decisions will be made.
Troy Pomroy, director IT, International Lifesciences Institute: Could you speak more about technology and its role in management architecture? In organizations I've worked with the combination of rapidly changing technology, high turnover in technology staff, and the costs surrounding technology projects make it difficult to effectively use technology tools in our working process regardless of ease of use or training. I find this particularly true in organizations with fewer than 150 staff. Much of what is discussed in the AOK groups can be rather philosophical and problems like the ones I mention are the realities that are often overlooked. Can you give some examples of strategies groups you've worked with use to approach the ever changing technology landscape. Debra: Troy, you have provided an excellent question better answered by those more knowledgeable - and technically more astute - than I. Obviously, the technology is integral to the Knowledge Value Proposition - being one-third of the picture, although only one-fifth of the management architecture we reviewed and onlyone-tenth of the innovation implementation strategy. This should not be taken as a demeaning of the role, however, which is certainly integral as you suggest. And again, you are correct that this element can be a costly investment. I guess this is support for a knowledge program being designed and implemented based more upon the dialogue process and positioning for future strategy rather than the 'knowledge-bases' - of existing knowledge. For many companies, a high percentage of the knowledge budget has been allocated for codifying existing knowledge. As I mentioned, there is an entire chapter in the book (and it is one of the largest) - Creating the Knowledge-Based Business dedicated to technology. In fact, we take great pain in making the linkage between Information Management and Knowledge Management - the distinctions and alignment. How Does One Prepare for a Technological Future Troy: How does one prepare - in terms of technology - for the future? Debra: Good question. I will admit that I didn't expect companies to embrace Internets so quickly and comprehensively. Nor, did I see the e-explosion as quickly as did others. [An aside note, though, the e-phenomenon is not a substitute for knowledge management or innovation for that matter!]. Your comment about small and medium-sized business is well taken. There is no way that they can keep up with the advances alone. My recommendation is that SMEs (small and medium enterprises) align in collaborative groups (e.g., consortiums) so that they can monitor and review trends and technologies collectively. I am not certain, but there may be some of the major research firms monitoring these trends who would sell their service to the consortium; and in this way, the consortium can develop a market research capacity (as long as it doesn't conflict with Antitrust laws!). The learnings need not be isolated to product/service selection, but can be expanded to including sharing insights about implementation - the Do's and Don'ts. I would keep my eyes on Collaborative Technologies! In fact, Dave Coleman, CEO of the firm by that name - has some of the best literature in the field - with practical methods of evolution and selection based upon the size and maturity of the company. A second superb source of very practical assessments, trends and tips are the archives of our newsletter - i3 Update/ENTOVATION News edited by David Skyrme. A third group researching the evolution of e-markets and knowledge enabling software is being managed through Bryan Davis of the Kaieteur Institute. I am certain, because of the people involved, that there will be considerable valuable practical information about the evolving technologies that will be of significant value. Hopefully, these
will provide some valuable leads in your search for More From Debra: I've given some more thought to a response to Troy Pomroy's good inquiry and am reminded of an experience in 1994. I was consulting to a major organization where we discovered there were 52 managers in the company with "knowledge' in their title. Many of them came from information departments. We convened a meeting of all of them and discovered there was no job description; whereupon, we took a blank page of a flip chart and crafted one. You may be surprised at the responsibilities and the sequence of importance: Knowledge Managers should:
And so, the alignment question may be how does the technology support the business strategy?! Although I am sure that AOK members are more than familiar with most of the knowledge portals; but this week's BRINT newsletter includes the 21 latest indepth full-text articles and reports on "New Economy'" "New Business Technology" issues relevant to business and technology professionals. HTML version of this newsletter issue is available online This one is worth the hot link!
Joe Katzman, KPMG Toronto: Debra wrote: " Invention and innovation ultimately must set any enterprise apart from the rest if it is to be uniquely of value in a competitive world." With respect, this is wrong. Execution sets an enterprise apart. That why VCs (venture capitalists) are less interested in your idea than in the quality of your management team. Other examples exist: - Xerox PARC has consistently been great at invention and innovation, but not execution. As a result, it has greatly enriched the world but has not done so for Xerox. - Dell doesn't innovate
much of anything - is anyone here going to argue - Hoffman LaRoche improved time to market for new drugs by a factor of years. By speeding up innovation via knowledge sharing? No, by improving the way they gathered and packaged information for delivery into the FDA approvals process. Benefits? In the multi-millions. Don't get me wrong, innovation is important. But even assuming that you can and do innovate, can you get your organization performing at that level in more than a few isolated pockets? Can you systematically share that new knowledge in a way that will get front line individuals (and not just "members of the CoP club") to use it, support it, find it when they need it instead of searching through inscrutable archives? Can the front lines add to that knowledge in a continuous process of kaizen, without going through a lot of intermediaries and without forcing people to spend a lot of their time looking for or monitoring the new insights? If you can't, the innovation is wasted. Most companies do not have an innovation problem, any more than famines are caused by a lack of food. Most innovations, like most famine victims, die or languish quietly because the distribution system does not exist, is broken, or is under-performing. Execution is like the bottom of Maslow's pyramid: until it's in place, everything above it is shaky. Does your KM system support front line execution? Is it - or at the very least, a key component of it - explicitly designed to this end? Execution and innovation are not exclusive, mind you, just different parts of the same puzzle. The thing is, innovation needs execution in the short term and execution needs innovation only in the medium to long term. This time disparity is what creates most of the problems. The larger view is that knowledge deployment needs to deal with 3 stages: generation, deployment, and front-line use by the (extended) enterprise. The tools are rarely the same for all 3, and neither are the processes. Variability by industry and by the situation an organization finds itself in will also result in different weighting of each stage. Add all this up, and that "15% maximum" rule looks very shaky. Some will benefit greatly from a heavier focus on external and internal best practices, others will not. Interestingly, KM advocates often complain about upper management placing excessive focus on front line use because that's the part that fits their experience and world view, and neglecting the other stages. There's some truth to that. Thing is, management complains about KM advocates just as avidly, and for the same reason. The accusation is that advocates are often big on the knowledge generation process (or if from IT, the deployment infrastructure) because it fits "their" personal preferences and world view, and that they often neglect front line use because it does not. This accusation also has more than a grain of truth to it. Debra: Either we will realize that we are in violent agreement or we will just have to professionally agree to disagree. I am not certain the verdict, but let me share my own insights. In our 1989 management research laboratories that also included the faculty from business schools (e.g., MIT, London School of Economics, et al), we began to focus on the innovation process as the process to manage. We performed detailed value-chain process analysis across all functions, business units, and other stakeholders (e.g., suppliers, distributors, customers, and the customer's customer - a concept developed then). In search of a management architecture that was simple, elegant and memorable, we realized that all other processes - and practices as previously mentioned by Denham Grey - could be put under the universal rubric of innovation. In fact, as we analyzed other aspects of transformation, innovation was the one process that would provide a common language and allow a universal architecture to make connections across all economic levels. Dr. Peter Drucker, in a 1995 Harvard Business Review, wrote that innovation is the one competence needed for the future and the ability to measure the performance thereof. We agree; but we have also realized that very few people have a fundamental understanding of the difference between 'invention' and 'innovation.' What we are discussing is not technological innovation, but knowledge innovation - complete with the learning systems necessary for exemplary practice. We have researched over 40 definitions of innovation and ten of them appear on our website - and are defined in the monograph, Collaborative Innovation and the Knowledge Economy, published by the Society of Management Accountants of Canada. Basically, they boil down to two perspectives: (1) Invention is separate from innovation; and (2) invention is the first stage in the process of innovation. We adhere to the second since we believe that the process is a value-system. Meg Wheatley provides the most illustrative definition:
We have simplified the process into the 3C's: Knowledge Creation, Knowledge Conversion and Knowledge Commercialization. Why have we selected 'innovation' as the focus of policy, process and practice? Innovation IS knowledge in action. We believe that an enterprise should be a learning organization . . . but to what end? The end is in the full realization of the idea - not the invention itself. If you were to consider who you consider to be great innovators, they are usually men and women who had the ability to convert their ideas or inventions into practice, such as viable businesses or other prosperous enterprises. Consider the characteristics of an innovator - even as opposed to an inventor. Now, this is where I believe we are in agreement. Execution is absolutely critical for all the reasons that you have outlined. But execution is not the end of a value-chain process. Execution is required throughout each of the 3 stages in the process. First, managers must envision the entire process (i.e., from cradle to grave, from seed to need, etc). Then, strategies can be developed to ensure proper execution and optimal results. Indeed, an enterprise has not fully innovated until customers demand more of the technology or service innovation! I also believe effective execution will set one enterprise apart from the rest; but it is because they are innovating and establishing new standards - not because they are following best practices - internal or external - per se. In terms of what VCs are funding, I believe there are some lessons to be learned. Not only should they be more concerned with the execution of the idea through an effective management team. Equally important is the capability of that team and organization to continue to innovate. Shareholders invest in the future of an organization. As an investor, I would be more concerned with how effectively the organization will continuously innovate - i.e., create new ideas and put them into the marketplace effectively and efficiently in advance of the competition. A good idea or technology is only the beginning. AS to your other good examples, all three were case studies featured in our research report: - Xerox PARC is a good example of a company that is excellent at 'inventing' but not innovating (i.e., putting the invention into commercial gain). - Dell actually did completely innovate the delivery process. And yes, their execution of their business model makes them the enterprise to emulate. - Hoffman LaRoche improved time to market for new drugs by a factor of years. Gathering and packaging information for delivery for efficient FDA approval is all part of the innovation process. Again, we agree that the organization needs to perform at an enterprise-wide level more than in a few isolated pockets? Our point is that if there is no explicit innovation process and no one - with whatever C*O title - responsible for optimizing that process - business results are left to serendipity. As you suggest, there must be methods - both human interaction and technical - to "systematically share that new knowledge in a way that will get front line individuals (and not just "members of the CoP club") to use it, support it, find it when they need it instead of searching through inscrutable archives? Moreover, we believe that those on the front lines - often the sales/service professionals have access to more valuable information that the rest of the organization. Oftentimes that customer interaction process is not valid, nor monitored. CRM - as a movement - has improved the process, just as quality placed attention on the process. But even the most progressive CRM programs appear to focus more on Knowledge of the customer, rather than a focus on customer knowledge. In an article, "Customer: Innovation: A Function of Knowledge," I suggest ways to 'innovate with the customer as a pathway to success. And so, I agree with you that "Not only can the front lines add to that knowledge in a continuous process of kaizen, without going through a lot of intermediaries and without forcing people to spend a lot of their time looking for or monitoring the new insights? If you can't, the innovation is wasted". . . or at the least is operating at sub-optimal performance. We will have to disagree that most companies do not have an innovation problem; indeed, this is the primary management problem of most companies - large and small, start-up or mature. Keeping the ideas flowing into prosperous implementation is the name of the management game. Many inventions (they are not innovations) will die or languish precisely because the distribution system does not exist, is broken, or is under-performing. Please note that the distribution system is part of the third stage in the process of innovation (i.e., commercialization, application, diffusion, etc). You can critique the "15% maximum" rule of thumb, but it has been my own industrial management experience that bears this out. I anticipate that the speed of change will increase, as will the compounding effects of 'kaleidoscopic change.' The real differentiator in the future will be those organizations able to effectively innovate to maintain their uniqueness and distinctive positioning in the marketplace. It will not be a matter of looking over ones shoulder to observe others. The answers will come from within with those with the imagination, courage and ability to take responsible risk to lead organizations forward.
Bruce Butterfield, CEO, The Forbes Group: Tom Peters seconded the view that copying others' best practices leads to implementing yesterday's strategies tomorrow in a day-long presentation to the Greater Washington Society of Association Executives (GWSAE) on February 23, 2001. You can view the presentation at his website. Debra: Thanks for your Tom Peters find. Actually, there is hardly a management guru - or a KM guru for that matter - that has not realized the importance of innovation as the process. Last time I checked with amazon.com, there were 2,402 books on innovation - many of which come from recognized names. A decade ago, almost all such books were about technological innovation. Today, more and more of the titles are recognizing the value of tacit knowledge, systems thinking, learning networks, and transformation - even revolution. Indeed, innovation - as a process - has finally been innovated!
- R.L. Wing Translation of Sun Tzu Debra: Over the years, I have given considerable thought to the essence of modern management - the vision, the language, the culture, the practices - and ultimately the strategy for optimal results. Ours has been a quest for the universal architecture - one that would connect relevant disciplines (e.g., economics, sociology, psychology, anthropology and technology - to mention a few; and at the same time, we researched trends on all levels of the economy (i.e., micro-, meso- and macro-economic. All this has been done in an era of unprecedented - we would call "kaleidoscopic" - change. At first, we reviewed behavior as a function of Maslow's hierarchy of needs. After spending time in academia, government and industry, we began to realize the commonalities - rather than the differences - in the sectors. In industry, we observed the value of cross-functional activity and began training accordingly. It was logical, then, to identify "knowledge" as the common element of focus and "innovation" as the process whereby knowledge might be created, converted and commercialized.
It was when I studied the Sun Tzu's Art of War - translated into the Art of Strategy - when the pieces all began to fit together. Consider the competitive
landscape - increasing daily on every front. With the anticipation
of accelerated communications and the shelf life of existing
knowledge, we might envision the intensity to increase, not decrease.
You need not agree, but consider for a moment, that we will soon
reach the law of diminishing returns from competitive strategies.
The rules of the game have changed; but the management practices
have not yet evolved. Our AOK conversation over the past three weeks has explored the "Community of Knowledge Practice" - especially the new role of Library and information professionals. We visited the new Knowledge Value Proposition to understand some of the rationale (the why) behind the movement. And yes, the transformation is far more of a fundamental transformation than a passing fad. Examination of the 1989 enterprise architecture afforded closer scrutiny of the variety of management elements (i.e., the what) and possible questions to be addressed. However, not until we review the innovation process (i.e., the how) do we see how knowledge can be created, converted into products and commercialized for profitable growth and/or prosperity. I believe that most knowledge practitioners are strategists at heart. Good strategists are not only visionaries; they know how to architect a plan for implementation, execute and monitor for results. One way to begin to calibrate the innovation process is to view the system as a whole by answering the ten questions outlined on the ENTOVATION Litmus Test - that provide manufacturing professionals with a broader view of the innovation system within which manufacturing responsibilities lie. These ten steps enable a company to see where it is on the scale of innovation management capability and provide a foundation for strategy formulation. As with any corporate-wide initiative, companies must establish key players, agree upon a framework for dialogue, create an implementation plan (ideally after all stakeholders have been interviewed), manage the process, evaluate results, and be open to new ideas and unexpected business opportunities.
In short, position innovation strategy and management as a core competency. Make the process - and the management and measurement thereof - explicit. Illustrate how it can be seen as the migration from Business Planning - with more dynamic, robust models for ensuring future success than documenting past performance. Ensure that individuals - ideally representing the 3-G's (Generations) - are motivated and rewarded for enhancing innovation. Take into consideration the relationships inherent in the "Extended Enterprise" or the "Strategic Business Network" (SBN) - suppliers, distributors, alliance partners, customers, customer's customers and even competitors. Avoid punishing failure as you are building a common innovation language and culture of "constructive innovation." And by all means, celebrate progress - even the little victories. Hopefully this dialogue has provided you a new vantage point from which you can observe the evolution of the Knowledge Economy and - more so - craft a role for your own leadership therein. Our research concludes that there are laggards and leaders in this field.
The leaders understand the fundamental nature of this movement and believe that we can "innovate our future - together." Thank you for the privilege of joining you and please keep me apprised of your progress! Always in your Network, Debra Debra
M. Amidon T:
978.988.7995
Jerry Ash, chief executive, AOK: It is with a great deal of gratitude and personal pride that I close the "Conversations with Debra M. Amidon with these words: Read today's final post from Debra very carefully. Consider her explicit descriptions of "Laggards and Leaders," and if you have been a casual observer of this extraordinary gift from Debra these last three weeks, get serious. Go back, Spend some deep time with the scenario she has laid out here. It could make the difference in your future as a laggard or leader. Debra, on behalf of the members of the Association of Knowledgework, I want to thank you for the amazing amount of work you have invested in this transfer of knowledge over the past three weeks. While Debra's work here is done, her involvement in AOK has just begun. Just like Stephen Denning before her, Debra has chosen to become a full Triple Plus Member of AOK and she will be here for you just as you are here for others in this Community of Knowledge Professionals. |
Architecting Success
Summary of Weeks I &
II