MODULE 6 - KNOWLEDGE ORGANIZATION - THE BUSINESS CASE

Firms today are beginning to realize that they attract and hire top intellectual talent only for them to manage and supervise yet another team of knowledge workers through the organization structure. This imposes upon senior management time and talent to focus on making such knowledge workers to work hand in hand with colleagues to experiment and innovate, to work in teams that have goals that cut across functions and job competencies. The wide use of teams and their consequent effectiveness has proven beyond doubt the success of making people work in structured as well as unstructured environments with only their goals in perspective.

The work force in turn having realized this potential are willing to take additional responsibilities, willing to be empowered and consequently operate with enhanced command over what they know (as knowledge) and its application in untested areas.

The primary challenge of an entrepreneur is to motivate top talent; to seize opportunities by utilizing their human resources effectively.

WHAT DOES THIS MEAN FOR THE 21ST CENTURY?

The 21st century, however, presupposes an organizational systemic preparedness for gaining and retaining competitiveness in a global and native business scenario. Knowledge organizations bring in challenges significantly different fromwhat has been so far experienced. The early 20th century predominantly focused on the manufacturing or the production priorities of the firm. The firm was treated as a mechanical outfit created to maximize products with labour as an important factor in the process. Thereafter, the sciences espoused manufacturing excellence with speed, automation of the human systems, socio-technical variables for efficiencies, scientific management, mass production, assembly line advantages, single product dominance and worker productivity.

What followed was the consumer era with the corporations prioritizing its energies towards creating and sustaining brands, products and life style interventions for the consumer. Sales and distribution networks were expanded to ensure reach, effective market penetration, identifying the consumer in the common person and ensuring product availability at his/her point of purchase. Supply chain efficiencies were dealt with as a single largest independent variable for ensuring customer satisfaction. The last two decades and the last quarter of the century realized the potential of the computer systems, electronic data processing, information management tools and techniques to help organizational data analysis, synthesis, decision support and primarily consolidation and retrieval. The systems were available through a process of aggregating the experience of users and technicians for corporate use and effectiveness. WHY WOULD INTELLECT DOMINATE THE KNOWLEDGE ERA? We are now at the threshold of the knowledge era, where the intellect would dominate organizational processes; make information and data only a fundamental and necessary condition for knowledge creation and management. The analysis, synthesis, and enveloping variables would be people, process and environment for making things happen. The knowledge organization environment, at least, in the first decade appears to be quite predictable for organizational scientists. The emergence and happening of the knowledge era is for sure. In the knowledge economy corporate performance is measured by the return on the knowledge invested. In fact knowledge is a personal wealth when it is achieved and is a corporate asset when it is shared and institutionalized.

More than a quarter of the petrol we but owe its existence to an idea and late night scribbles in the notebooks of two Mobil scientists. They discovered that a synthetic catalyst could make crude oil yield far more petrol than ever. Their breakthrough led to a process that is now being used in nearly every major refinery in the world. Charles Plank and Edward Rosinski, Dr. Steve Smith or Dr. Roger Hall of Syngenta, Dr. S. Venkataraman of Applied Materials, who hold several US patents, epitomize the knowledge people we are talking about.3 Chief Executives like Mr. Prakash Apte of Syngenta India bring together teams of people who drive a country organization using the principle of knowledge, action and results.

In fact breakthroughs in Knowledge Management are led by Chief Executives, Sanjay Lalbhai of the Lalbhai Group led the denim revolution, Shrirang Samant of HDFC Chubb Insurance led the general insurance breakthroughs, Aditya Puri through HDFC Bank, Jerry Rao of Citibank led consumer revolution in banking, Prakash Apte of Syngenta led the crop protection solution, Dr. Ferzaan engineer of Quintiles brought in high end clinical trials, Hardeep Singh of Cargill brought in a packed foods business of commodities, M.S. Banga or H. Manwani of Unilever converted wants into needs in consumers, Bobby Parikh of Andersen/Ernst & Young created innovations in tax practice, Ambani made mega projects look like child’s play, Kamath of ICICI made a monolithic financial institution into a agile private sector bank and Narayan Seshadri of KPMG Consulting transformed business consulting methodology and rewrote fundamentals and the list could go on. RESOURCE DEPENDENCE WILL COME DOWN Capital resources and asset management turn negligible management parameters for creation of shareholder wealth. While investing resources continue to be an essential ingredient for corporate competitiveness and retaining innovative advantages, money by itself would mean precious little to make or break a deal. Knowledge brought in and grown by the corporate determines organizational competitiveness and successes seen as fundamental for business survival. The premium for managerial actions is on the ability to attract, hold, and maximize the intellectual equity available within the corporate. Interestingly the cycle of maximization, optimization and minimization is inevitable in human capital management too. People bring in to their organizational settings a core set of knowledge, experience, competencies, skills, learning, training, demonstrated performance and potential. The summation of this set of parameters is the organizational intellectual equity. The environment necessitates global networks, connected business portfolios, functional linkages across geographies, resources grouping and sharing in a seamless, boundary less organizational space. It is an opportunity to invent anywhere and share in all necessary places as may be deemed appropriate.

Concurrently corporate environment and people manifested boundaries are seemingly disappearing. Corporate creation and management is no longer asset dependent and myopic in term. There is a distinctive alignment of objectives on what constitutes corporate wealth and should be nurtured and grown in value. CUSTOMER NEEDS ARE DISCERNING At the external influence scenario there is a critical focus on value imperative and making marginal improvement appear inconsequential. The customer does not pay for corporate inefficiencies and poor management. The opportunity to transfer in the short and medium term organizational handicaps to the customer or in some situations where environmental protection was available the inefficiencies continued and was shared with the customer indefinitely. Nevertheless, value and service imperative become fundamental, unarguably. The customer truly has limitless options to determine alternatives, evaluate concurrent advantages, make choices on a time frame that is open, transparent and easy to administer. In other words, the customer is under no compulsion to buy what is available at the first distribution location or be governed by ad factors that profile the products more attractively than what it delivers. Options have not emerged because corporate turned efficient in the consumer environment, but the environment in which the consumer shopped turned turtle. Products that were far and wide in reach and purchasability were now available at the current consumer environment for added value at an affordable price.

21ST CENTURY MEANS TECHNOLOGY The knowledge organizational business is likely to cope with a dramatic managerial change given the advent of information technology and knowledge emphasis in the basics of management actions.4 The service trade-on meant more value at lower cost and the organizational product offering reflected choice, value, service and shopping advantage to the average consumer. The new order business necessitates aggressive IT investment, basically to remain competitive and cope with the changing environment. Service to the consumer necessitates core and purposeful IT investments meant to dramatically make the winning product difference.

Why, because Technology will Substitute Infrastructure: Technology should substitute infrastructure in any form. In the organization form of the firm structures turn wide and spread out across product, geography and functional boundaries. Forms could mean multiple business units connected by the value adding staff and a core corporate group. Functions and businesses need to integrate for effecting customer service. Yet functional and specialist compromise for depth of the intellect is counter productive. Pyramids no longer should be repeated for each of the product segment with the SBU5 as a method. The alternate forms of MBU (Multiple Business Units)6 with brand-market and product-manufacturing focus would turn more effective for the IT driven organization. All other services are available electronically. IT effectively connects people than otherwise through a traditional channel of HR.

Because, Technology will Co-opt Competition: The knowledge organization business presupposes cooperation and collaboration for effective competition. Market strategies to demonstrate dominance without value but by consumer influencers would turn counter productive for corporate. Competition would but find inevitable to collaborate and cooperate to make the product offering aggressive to draw the customer towards it. The current trend in mergers of mega corporate that are successful with larger corporate is an indicator of the inevitable trend of large corporate cooperation. Yet the corporate need to bring in boutique products to suit the frills and thrills of a discerning consumer, make the manufacturing process mass customized; demonstrate manufacturing flexibility — all make a satisfied customer. Wealth from manufacturing is being created by ideas, brainpower — design, logistics, marketing, sales and information systems.

Because, Technology will build the Human Society: Human society is infinitely complex and difficult to interpret and manage. Rarely do rational choices become the fundamental orientation for managing the human issues. Technology has only added to its complication. For companies to maintain and enhance its competitiveness a broad spectrum of understanding is essential to differentiate between compelling and not so compelling parameters in human management and technology interface. Large corporations derive a world view as they see the coexistence of human factors and technology imperatives that make organizations viable and growing. ORGANIZATIONAL PERFORMANCE DETERMINANTS Organizations are created with some expectations. The stakeholders that include the shareholders, customers, regulators have a variety of expectations from the organizations. The sum total of these expectations from the organization becomes the benchmark against which the organization is measured. Memorandum of Understanding, Expectation Agreements are some examples of such expectations. 1. First Determinant — Strategy The organization’s strategy is its chosen way of meeting these expectations. While the effectiveness of the strategy radically affects the probability of meeting expectations, organizations with similar strategies differ in their results. These differences can be attributed to the organization’s ability to execute a given strategy. 2. Second Determinant — Design This ability is a function of the design of the organization and its operation. The design of the structure, processes and technology has to be geared towards performance. Moreover the structure, processes and technology have to collectively make sense. People who are working within the organization cannot rectify inconsistencies in the design of the organization. The structure includes the division of roles and accountabilities across the value chain, levels and geography. The management processes are meant to interconnect roles for meeting the expectations of the stakeholders. Such processes would include Manpower Planning, Resourcing and Performance Management, obtaining feedback and starting planning again. The performance management process would include breaking corporate goals down to individual levels, micro goal setting, establishing connections between financial goals, customer measures, internal process measures and people development measures, measurement of results against objectives and appropriate feedback and corrective mechanisms. The technology and infrastructure provides the platform that enables the people to perform their roles. 3. Third Determinant — People The people and the people management processes are the software of the organization. These perform within the context of the above structure, process and technology. Even the best of the performance management processes cannot guarantee performance if this system of structure, process, technology and people collectively do not make sense. ORGANIZATIONAL PERFORMANCE OUTCOME Organizational Performance is the outcome of the interactions between these organizational variables discussed above as performance determinants. Each of these variables is an independent and dependent variable at the same time. Each variable influences the other all the time. Structures influence behaviour and behaviour make structures succeed or fail. As a consequence, the interactions between these variables are not linear. These interactions are, therefore, cyclical, reciprocal and systemic. These systemic relationships make the task of the organization designer and the chief executive complex and difficult. Unraveling mysteries of organizational performance is therefore, a complex task that requires clarifying the systemic relationships between these variables. Most analyses that seek a linear explanation hence fail to yield results. For this to be effective we need to find effective ways to approach the systemic problem. APPROACHING A SYSTEMIC PROBLEM 1. Comprehensive Understanding of Business Realities In order to make a substantial difference to a systemic issue such as organizational performance, a thorough understanding of the client’s business and organizational realities is essential. Such a study should include the organization’s environment (current and expected) including competition, regulatory environment, relative strengths and weaknesses, business processes, geographical presence, employee profile and technological infrastructure. 2. Causal Loops and Archetypes In an interdependent system such as the one that operates in a company, the real inter linkages are not apparent. There is, therefore, a tendency to look for the root cause - Causal Loop Diagramming: Archetypes

Causal Loop Learning

of the problem outside the system, whereas the problem lies within the system. Problems continue through causal loops that interact in the form of typical “archetypes.” Piecemeal solutions quite often exacerbate the problem, since they reinforce some of the causal loops. The solution lies in collectively discovering the archetypes, breaking the destructive loops and creating winning loops. Systems Thinking offers a technique of analyzing complex circular relationships of this nature. Causal loop diagrams help unravel the cause effect relationships between the variables and determine the areas for impact. 3. Interactive and Partnering Such interventions are best achieved by a group of people who work on understanding the causality amongst the various factors and opportunities for interventions. The company should work closely with the facilitators. The facilitating team should bring in complementary skills necessary for an assignment of this nature and learn from each other during the process. 4. Phased Approach A phased approach ensures that the management and the facilitators can review the engagement at key points and decide appropriate course for the way forward. A phased approach offers opportunities for reviewing scope at the end of every stage, making midcourse corrections, changing pace of the project, and adding resources if required. 5. System Diagnostic The focus is on establishing the inter linkages within the system through problem definition and analysis. This can be achieved through interviews with senior management, branch managers, customers, employees and unions. PERFORMANCE MANAGEMENT SYSTEM Some key questions and issues need to be addressed in enabling a performance management system.

(a) How can performance be driven down to the level of the lower most unit (budgets, targets, profitability)? (b) How can we arrive at a linkage of financial performance metrics with customer acquisition, retention, service and satisfaction linkage of customer metrics to internal process efficiencies? (c) How do we establish linkage of process efficiency assumptions to people skills and competencies? (d) What are the Factors that contribute to and hinder performance (structure, processes, technology, locations, personnel policies)?

LEADERSHIP INFLUENCES PERFORMANCE IN AN ORGANIZATION Leadership continues to be a critical factor in influencing the knowledge factor in the business organizations. Some critical issues are:

1. Assessment of leadership challenges in a business scenario 2. Assessment of challenges that leader faces at various levels 3. Effective Management Styles in performing leadership roles 4. Factors that help or hinder leadership behaviours 5. Impact of leadership on building the organizational culture 6. Market and competitive pressures that influence leadership performance 7. Impact of globalization and change on leadership THE WORLD OF KNOWLEDGE AND LEARNING Japanese companies bring in a sense of realism to the otherwise developing field of knowledge management. Japanese companies have demonstrated their ability, skills and expertise in organizational knowledge creation.7 Organizational knowledge is critical to the distinctive ways that Japanese companies have remained competitive by innovating, learning and applying their learned knowledge. Electronics, automobiles, entertainment, infrastructure are but a few examples of Japanese dominance in the global market. Japanese have consistently shown their resilience to economic pressures and have coped with uncertainty.

Honda’s success is attributed to its development of an energy-efficient power engine. Canon created a singular excellence through its unitary product AE-1, the first single lens camera with a built in electronic brain. Sony became a global household name in the context of traditional high quality players from Germany and U.S.8 Akio Morita9 attributes excellence of Sony Corporation to innovation. The ability to convert intellectual energy to customer application has been its competitive advantage. Japanese bring in continuous innovation by anticipating the changes in consumer preferences; processes and technology, product quality and changing customer needs and wants, making the customer want what he does not even know that it even exists. Bring up the aspiration levels of the consumer and meet it at an irresistible price. Nokia, Sweden has developed phone instruments that can give customers online news, stock prices, financial updates and many more information based services. Their competitive advantage was to seek knowledge held by those outside the organization. While Japan is but one example the pace of change in the developed world brings us to observe several happenings and predictions of the future.

In contrast the very world of change symbolized by the Internet has changed the industry that created it, the Information Technology industry. The IT industry is already feeling the full force of how profoundly disruptive the Internet can be on technological and user capabilities. IBM, Oracle, Microsoft and Intel are taking a long hard look to figure out what they really are now or what do they need to do to remain in business.

The PC is simply not the focal point now. It is but one of the growing constellations of digital devices ranging from mainframe-like-servers to networking switches and routers to TV set-top boxes and game machines to hand held personal organizers, smart cell phones, and interactive pagers that are the vehicles for innovation going forward.

The European Commission’s (1996) White Paper on Education and Training highlights the impact of the information society on work and organization, the impact of international organization on the need for competitiveness, and the impact of scientific and technological knowledge on industry. Growing competition, technological changes, new worry methods, financial constraints, globalization, reorganizations, mergers and the like, give rise to a need for organizations to learn and adapt more quickly to changing circumstances. In the words of McCarthy (1997), ‘these processes necessitated continuous improvement both in people and in organizations.’ This is a central, if fairly general feature of the learning organization.

Definitions: There are many more specific definitions of the concept, most of which include notion about continuous learning, innovation, responsiveness, commitment, collaboration shared vision, openness in communication, shared values, dialogue, the use of IT, empowerment, and so forth. Some of these definitions are of a descriptive nature while others are more normatively orientated. Let us start by looking at how three core thinkers about the concept, Pedler, Burgoyn and Boydell (1989:2), define it. They describe the learning organization as ‘an organization which facilitates the learning of all its members and continuously transforms itself.’ As indicated above, this definition contains an individual and an organizational change element Individual learning is necessary but not sufficient for organizations to learn. Interestingly in a more recent publication the same authors define the concept as ‘an organization that facilitates the learning of all its members and consciously transforms itself and its context’ (Pedler et al., 1996:3). Organizations now need to be able to impact upon their environment as well as adapt to the changes taking place — a concern that had already been raised much earlier by Henry Mintzberg (1979). In fact, Mintzberg showed how (particularly larger) organizations succeed in affecting the circumstances in which they have to operate (for example, their clients, local and government policies, and so forth).

Individual and Organizational Learning: Whereas Pedler et al. stress the importance of “organizational learning”; Mumford (1995) finds the learning organization literature focuses too much on the structural element. In his opinion, “individuals (and teams) must learn before there can be anything like organizational learning.” Another core thinker about the learning organization, Peter Senge (1990:3), tries to integrate these two approaches. His definition, however, is quite a normative one. An organization where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning how to learn together.

10. Schlender, B., The Real Road Ahead, Fortune, Pages 96-106, October 25,1999.

The concept of the learning organization has been a popular one for quite some time now. According to Garratt (1995), the key ideas about the learning organization were already developed immediately after World War II. It has taken much longer, however, before they were actually applied. The concept came of age under the impact of a rapidly developing world of work and organization. Pedler et al. (1991) trace back the history of the concept (and a related one — total quality management) as stemming from earlier approaches such as organization development, individual self-development, action learning, and the excellence movement of the 1970s and 1980s; all of which in turn followed post-war concern of systematic training. Peter Senge presents five disciplines for learning organizations: 1. Personal mastery, ensuring individual motivation to learn; 2. Mental models, creating openness to misconceptions; 3. Shared vision, building long-term commitment in people; 4. Team learning, developing group skills like cooperation, communication and so forth; 5. Systems thinking that constitute ‘the most important discipline’ integrating the other four. 6. An organization which has the capability to adapt to changes in its external environment, continually enhance its capability to change/adapt and innovate, develop collective as well as individual learning and use the results of learning to achieve better results. 7. Learning organization is one that learns and encourages learning among its people. It promotes exchange of information between employees hence creating a more knowledgeable work force. 8. Hence, this produces a very flexible organization where people will accept and adapt to new ideas and changes through a shared vision. 9. For example, Royal Dutch/Shell institutionalised and internalised the Scenario Planning process in all its businesses. This gave the company the collective ability to envision scenarios in every area of its operation, create strategies for coping with environmental scenarios such as oil stocks. All the disciplines are to be practiced alongside each other and they have an impact on one another as well. As Hodgkinson (1998) describes, the learning organization is a process rather than a state, something that all members of an organization have to work on all the time, yet can never be fully realized. Pedler and Aspinwall (1996:182), too, stress that the learning company must remain a particular vision, to be realized in the context of a unique organization. Even though this may be the case, they consider it possible to generalize about organizational learning. People in companies learn from the problems, dilemmas and difficulties they encounter, together with their attempts to overcome them. Companies have much to learn from each other, too, but this can only be achieved if the contrasts are raised and the differences between them made explicit. In other words, there is no such thing as the learning organization, but a variety of learning organizations that embarks upon the knowledge transformation journey that can benefit from each other’s experiences.

Knowledge — Learning Management Watkins and Marsick (1993) emphasize that systems to capture and share individual learning must be put in place before organizations can learn. Nonaka and Takeuchi (1991) describe such a system of knowledge creation in companies. They distinguish four types of knowledge conversion among people, which can be combined to form processes in time: ● Socialization: tacit knowledge reproduced as tacit knowledge. People learn from each other by sharing experiences, imitation, trial and error, and so forth. ● Externalization: tacit knowledge made explicit. People learn by systematizing and coding their implicit knowledge, making visible what is hidden inside them. ● Combination: explicit knowledge reproduced as explicit knowledge. People learn using materials and other resources specifically aimed at teaching people. ● Internalization: explicit knowledge made tacit. People learn by practicing skills, automating procedures, acquainting themselves with tasks by doing them. Nonaka and Takeuchi speak about a hypertext organization rather than a learning organization. According to their ideas, this type of company succeeds in combining the efficiency of a bureaucratic organization with the innovation capability of an adhocracy organization (Mintzberg, 1979). This is achieved by involving all layers of the organization in the right kinds of knowledge conversion at the right time, through codification and commodity creation of individual tacit knowledge (Grey, 1998). Every member in the company thus contributes to the creation, management and proliferation of collective knowledge throughout the organization.

In a literature review, Poell et al. (1997) concluded that, although there are many definitions of the concept of a learning organization, a number of issues keep recurring. Themes describe the elements in a learning system that makes for an efficient, flexible and viable company: Some factors being: 1. Continuous learning on the individual, group and system level; 2. Single- and double-loop learning processes. Swieringa and Wierdsma (1992) even conceive of triple-loop learning: not just doing things well, not just doing things better but also doing better things; 3. Creation and distribution of information and knowledge, Nonaka and Takeuchi (1995); 4. Inquiry and dialogue in groups (sharing learning experiences); 5. Increasing the learning capacity of members (learning to learn) — Peter Senge (1990); 6. Integration of work and learning (informal learning, learning on the job); 7. Shared vision (theory of action) cf. Peter Senge (1990);

Empowerment of individual learners — According to the White Paper on Education and Training (European Commission/1996:40).

Vocational training in enterprises is increasingly taking place on the basis of a training plan that the workers themselves and their representatives have been involved in preparing. In the most progressive and most efficient companies, this training is organized less and less around the acquisition of skills for a specific task or even a clearly defined job. 1. Coaching by the manager; 2. Transformation and innovation; 3. Learning tied to business objectives but also for personal development. Poell and Tijmensen (1996) had already concluded that the literature on learning organizations implicitly proposes a redefinition of the organization of work into team- based structures/so as to allow for an integration of learning and work. Every work activity can also become a learning activity. Work is performed in multifunctional teams, thinking and doing are integrated into jobs, and workers are empowered to participate in team decision-making processes (Tjepkema, 1993). Before going on to highlight some criticisms of the learning organization concept, two actual examples of the way in which a learning company operates may help illustrate the ideas presented here. Two real-life case studies, one from a large Dutch electronics firm and one from a Dutch night school for adults are described.

11 (The Learning Organization: A Critical Evaluation, Rob Poell) 11. Senge Peter, Fifth Discipline — The Learning Organization and The Learning Organization: A Critical Evaluation, Rob Poell.

THE WORLD OF KNOWLEDGE BRINGS IN ESSENTIAL CHARACTERISTICS Characteristic 1: Economic future based on knowledge12 thrives on weightlessness in size, scope and horizon in the context of service industry.13 1. The top 20% of the world’s labour force constituting the knowledge worker and today this knowledge worker will earn more than the other 80% combined. Knowledge Workers (Peter Drucker) (design engineers, research scientists, software analysts, lawyers, creative professionals, brand managers, financial specialists, HR specialists, tax consultants etc.) dominate both the job market and the consequent compensation. Drucker defines knowledge worker as an executive who knows how to allocate knowledge to productive use, just as the capitalist knew how to allocate capital resources to the organization.14 2. This knowledge-based work will represent the bulk of wealth creation in modern economies — 92% of the GNP by the year 2010. 3. Enterprise growth will be determined by innovation that in turn depends on knowledge and the intellect. Japanese and now the IT firms have demonstrated an unrelenting search for new ways of doing business.15 4. Today over 15% of factory line workers have some college education, and over 30% of precision production or craft workers are college graduates.16 5. The value chain restructuring will ensure 70% to 90% value additions in service “intangibles.” To list a few, these intangibles are customized service, online ordering, mail-order delivery, and electronic commerce services. The value element of manufacturing and raw material content in the provision of any product will constitute only the balance 10 to 30%. 6. The brain and not the brawn would turn into the critical success factor for economic growth. Intellectual infrastructure that is inherently more difficult to organize and manage, will gain predominance over physical infrastructure that can be globally resourced. Third world countries in turn have utilized this opportunity to open doors for low cost manufacturing, e.g., China, India, Pakistan, Bangladesh, Africa, and South America etc. 7. The Internet and the World Wide Web are revolutionizing the way we work, the way we do things to make things happen and the way we would find corporate most effective in the toughest of business environments. All because of knowledge and information at the call of a business enterprise. Intel ranks #1 in the world for overall e-commerce revenue.17 Intel is averaging $ 1 billion worth of online orders every month from customers in 46 countries. They are checking product specs, pricing, availability, order status and delivery dates in real time. All information is personalized for every company and for every type of user and close to half of Intel’s direct customer business is happening on line, on a set of Internet applications built in just a few months. That is how fast the Internet is changing the way we all do business. 8. A new electronic market place is in the making. Consumers are now in a position to do things stationary, from where they are. 9. Venture capital investments will compound in the electronic knowledge industry with more dormant investors willing to play soft for an aggressive enhancement of shareholders’ wealth. Amazon.com has posted its third quarter loss (1999) while growing and doubling their revenue goals, way beyond analyst’s expectation. Many Internet companies, AOL.Com, Yahoo.Com, for example, are growing their community share while losing heavily on their short-term profitability. Many companies are even unwilling to predict when they would start making money. 10. The blue-collar work force numbers will decline and wage disparity between the knowledge worker and the manual worker will rise. This will cause unseen volatility between hitherto peaceful teams coexisting in a mutually dependent work environment. 11. Knowledge based competencies and core functional skills will determine employability. People will no longer be in a position to obtain and retain jobs on their inherited knowledge. Their competitive positioning will sustain only with updated state of art knowledge, contemporary enough to hold on to their jobs. Even the traditionally physical work such as factory employment will call for a knowledge worker multi-skilled in manufacturing technology and Information systems. 12. The rise of single state entrepreneurs will raise several folds. People with a machine and mind will begin to make things happen. Their competitive advantage will be their ability to think technologically and scientifically keeping behavioural compulsions of the work place to a bare minimum. 13. One quarter of the previous year’s training and development programs, skill courses, knowledge-updating efforts are either outdated or useless for today’s scenario. Characteristic 2: The global market place and customers determine the growing competition. ● Computing facilities, technological capabilities facilitate global networking and management functioning simple and easy to administer. ● Shift in markets to erstwhile third world economies; shift to the second world post end of the cold war makes available cheaper and substitutable opportunities. ● Product development and innovation competencies become possible, easier to replicate, in these new worlds, given availability of human resource from the third world at affordable prices. ● Greater market research capabilities and transmission of market knowledge on an on line basis make product offering in a well-planned informed manner. The data transmission capabilities make decision making and backward production planning efficient and eliminate loss of wasted production and carrying of unnecessary inventory. ● Global low cost supply chains facilitated by electronic networks, polygenic access to consumer data, needs and wants make linkages to the supply chain effective. Supply chains will have seemingly virtual connectivity and dynamic configurations. ● Knowledge has made the inevitable happen intellectually. The gap between the third world and first world is radically thinning given equivalent access and database. Process conversion will inevitably be the concern to the third world. ● Mergers and acquisitions in the US reached a high of $ 949 billion in the first half of 1998 beating 1997’s full year record of $ 926 billion. Banking, financial sector, telecommunications and entertainment would dominate and the year 2006 would conclude with, perhaps, over $ 2.8 trillion of M & A value.19 Characteristic 3: Growth based on knowledge20 necessitates unbridled pace of change radical enough to seek time and planning efficiencies. Traditional methods of project planning requiring infrastructure, large management intensive actions and physical and financial resources will increasingly become less relevant. There would be players willing to offer similar activities at a competitive cost scenario and at a global class and standard. The knowledge infrastructure will determine the sustenance of any service effort. ● Knowledge assets will compound the returns on physical infrastructure and make large and expansive capital investments easy to manage and deliver. ● Virtual working time would make presence at the workplace not necessary for productive output. Flexibility in working, meeting customer satisfaction requirements out of workplace would turn inevitable. ● Physical assets for creating a work environment are reducing and would no longer be a determining basic motivational factor. Thus corporate investment can focus away from the static unproductive office space creation to a productive investment in knowledge. ● Developing economies are getting a large chunk of capital investments directed at creating manufacturing capabilities. Migration of capital is unbounded and no longer is these developing economies dependent on internal generation of capital. ● More than 50% of revenue of knowledge industries comes from products introduced in the current year. Product life cycles have undergone a new meaning in an era where the only recipe for success is innovation and this innovation implies obsolescence of the earlier product. ● Learning and growth curves for most economies have shrunk to less than 10% of the past experiences. In most manufacturing sectors, Asian countries have replicated capacities in 5 years what the Americas and Europe took 5 decades to master. ● Industrial life cycles are shortening too less than a decade. Entire industries are spawning and dying within a decade’s life span. ● Automation has seen growth rates multiplying while employment rates are fractionalized. ● A $ 1000 laptop computer or a $ 500 I Mate Pocket PC the size of a wallet today is more powerful than a $ 10Mn mainframe computer of 1975. Characteristic 4: National, territorial, geographic alignment and tariff barriers have any organization or a country coming to an end. 1. Geographical decentralization leading to removal of a national identity is inevitable. Sony Corporation after several decades of inventing and marketing in other continents has now created a strategic plan for Asia, its so-called parent continent. 2. Tariff and extraneous influences to restrain free and fair trade and competition is at its end. With or without GATT, companies are finding ways of manufacturing and operating in the lowest tariff trade blocs. Economies who seek capital and investment as also a market for their products have to perforce make such investments attractive by lowering tariffs. 3. Cross holding shares from one to another even into competitor territory is real and will happen. Or buying out your competitor customers will become an additional step in a volatile competitive scenario? CEO of Sun Microsystems alleges that Microsoft is buying pieces out of all of Sun’s customers — AT&T, Nextel, Roadrunner Cable Modem Service, Qwest, Comcast, Canada’s Rogers Cable. In addition Microsoft has made several dozen telecom and cable investments over the past two years.21 IBM and Siemens work on producing a 16-megabyte chip for France. Daimler Benz executives talk to Mitsubishi for joint ventures and Ford complete joint production with Nissan while owning one quarter of Mazda. It can be alarmingly complex when NEC and IBM both own equity stakes in Bull, the French Computer Company, which owns a majority of Honeywell, and Honeywell is in alliance with NEC, which, of course, competes with IBM. Daimler completes its merger with Chrysler Corporation to become Daimler Chrysler. 4. Employment has become a transnational phenomenon. A chunk of employment of the American software industry resides and works in India. It is estimated that over 4 million virtual aliens are already employed directly in U S work force, existing outside the national borders. The employees are only connected through an electronic gateway. Bangalore alone has over 35,000 software professionals located and working at one location.22 5. Tax structure and high labour cost have necessitated relocation of most corporate activities interconnected only through communication networks. 6. Scale of economies is eroding “Government” power. The turnover of a General Motors, General Electric,23 or a Microsoft Corporation would be larger than the GNP of several nations. MANAGING THE KNOWLEDGE ORGANIZATION What constitutes the knowledge asset? Unlike information, knowledge is less tangible and depends on human cognition and awareness. Measuring the knowledge assets and as a consequence managing those means putting a value on people, both as individuals and more importantly on their collective capability, and other factors such as the embedded intelligence in an organization’s computer systems.24 Knowledge Management (KM) is a conscious strategy of getting the right knowledge to the right people at the right time and helping people share and put information into action in ways that strive to improve organizational performance.25 It is a framework, a management mindset that includes building upon past experiences and creating new vehicles for exchanging knowledge. (Knowledge enabled Intranet sites, communities of practice, networks). KM will be a foundation like TQM or ZBB that lays the basics for integrated quality management or looking at financial accounting from ground up. MANAGING KNOWLEDGE AS AN ASSET Knowledge is an asset that is unique and unlike any other comparable asset definition. Knowledge emerges as it is used and absorbed by more and more people. As an idea is absorbed and discussed, experimented, improved upon knowledge upgradation is consequential. Knowledge grows in value as it is absorbed, understood, standardized and documented for the use of others. As we grow knowledge it disperses across user groups depending upon individual or collective understanding of that particular knowledge. This in turn makes knowledge break itself into parts not visualized by the creator. Each holder of this part knowledge, if you will, now has the obligation to complete the whole and submit it for further people processing. One idea has now because of its usage by different people become multiple ideas. An initial state of fragmentation concludes into a larger whole. MANAGING KNOWLEDGE AS A COLLECTION AGENT Most companies commence their KM activities by focusing on creating, identifying, collecting, consolidating, interpreting and sharing best practices or learning that needs an organization wide understanding. Organizational knowledge is available at both physical level and at the intellectual level of human beings. What is known or can be found out becoming explicit and what is stored within the minds of people being tacit knowledge. Explicit knowledge can be expressed in words and numbers, and easily communicated and shared in the form of hard data, scientific formulae, codified procedures, or universal principles, whereas tacit knowledge is not easily visible and expressible. Tacit knowledge is highly personal and hard to formalize, making it difficult to communicate or to share with others. MANAGING KNOWLEDGE AS A LEARNING REPOSITORY The implication for organizations is to help members learn, internalize and apply what they know to what they are doing. The problem in managing is not the theoretical understanding that knowledge exists but on how to get what we know benchmarked and practiced across the board. Quinn (1992)26 notes that the capacity to manage “knowledge based intellect” is fast becoming the critical executive skill of this era. Reich27 states that the only true competitive advantage will reside among “symbolic analysts” who are equipped with the knowledge to identify, solve, and broker new problems. The human aspects of new knowledge creation revolve around: ● An education system focusing on fundamentals relevant to a class of activity or pursuit of a goal that is instinctively present in a person. (Native Talent upgradation). ● The dynamic and continuously evolving nature of knowledge. (Continuous learning and best practices). ● The tacit and explicit dimensions of knowledge creation. (Socialization/ Externalization/Internalization/Combination). ● The subjective, interpretative and meaning making bases of knowledge creation (Meaning and Alternatives) and ● The constructive nature of knowledge creation.(Anticipatory Nature of Organizational Response). Aspects pertaining to knowledge deal with the following: 1. Knowledge Intensive Process Intervention and Planning. 2. A Permeating Knowledge Relational Culture. 3. Knowledge supported technological capabilities; systemic infrastructure is an essential effectiveness factor. 4. Content, Corporate Knowledge Bank, Data Mining Memory and Problem. 5. Grasping and Solving Capability. 6. “Retreat” for knowledge gaps. 7. Team Knowledge Management. 8. Knowledge Value Sharing and Building/Blocking Blocks. (1) Knowledge Intensive Process Intervention and Planning For organizations to make both tacit and explicit knowledge useful, processes should build in opportunities for learning from direct experience. Peter Senge28 addressed this issue as “Systems Thinking”, to shift the mind from seeing the parts to seeing the whole. Knowledge becomes the rudimentary basic to help in following organizational processes. Processes could mean following through a strategic planning path to its logical conclusion involving all critical members of the staff. Or it could mean participating and communicating with each other within the organization to manage the performance appraisal program. It could involve commitment to the feedback and review process, counselling or sheer adaptive learning. The connecting factor is knowledge. Knowledge is a human capability and acquires appreciative and depreciative characteristics if not handled within time frames. The concept is based on redundancy, a process wherein organizations begin to reinvent themselves forgetting the old for the new. And in this process several learnings from the past are consequently lost. It is essential for companies to create process efficiencies not around traditional tasks or outcomes, but around logical sequence of what needs to be known at each step. Techniques such as knowledge process mapping can be combined with traditional process improvement and team based learning techniques to gain on line work in progress effectiveness.29 Ford has, through a combination of cost reduction and creation of high value ideas, generated over $ 230 million in savings. They estimate that this conscious effort to continuously gather and distribute leading practices will deliver some $ 400 million in added value to the company, with as much as $ 1 billion in total savings over the next five years. (2) A Permeating Knowledge Relational Culture The corporate need to make people share with one another knowledge gained is a minimum requirement of the corporation. Knowledge should neither be possessed nor filtered while disseminating. The culture should make people seek knowledge from wherever it is available, irrespective of its source in the position of the hierarchy. Creating a culture to share would imply a caring, trusting environment, but presupposed with a stick that swings when knowledge is withheld or suppressed. Knowledge acquisition is a dynamic process of culture creation. Whether an individual does acquire knowledge from a source depends on a dynamic interaction in which two factors are important: ● The similarity between the person’s context and environment and experience, situation, history, inheritance etc. and ● The degree of congruence between how the material is structured and how the structure appears to the person in the culture. ● Transcending a multitude of dichotomies and contradiction creates knowledge. For example, Mind versus Body, Tacit versus Explicit, Individual versus Organization, East versus West etc.30 Knowledge is a personal ability when it is achieved; it is a corporate asset when it is shared. It is a collection of insights that, when applied, makes the organization more effective and profitable. Unlike data and information, which tell us what happened and what exists, knowledge tells us what works, what matters, what should we trust, where things go wrong and how to fix them. Knowledge is the heart and soul of a corporation’s assets. Creating a culture where people can feel the real life benefits of knowledge around them is essential for KM strategies to work. IT makes this strategy work effectively through Intranet, Teleconferencing, Data Warehousing, Call capabilities, user- friendly architecture, effective documentation and training. More importantly culture facilitates transfer of knowledge from one individual or one team to another. Electronic user advantages, enterprise-support systems, more than overwhelm the downsides of making KM and KM sharing mandatory in an organization. While in the short run KM strategies would look theoretical and superficial or at times old wine in a new bottle syndrome, nevertheless, the inevitability of making KM turning advantageous to individual effectiveness cannot be mitigated. Gary M. Reiner of GE since 1996, his date of appointment, would use information technology to provide competitive advantages and growth opportunities for all of GE’s businesses worldwide. IT was being used for a business advancement strategy.31 And cultures do get defined in many ways as we see from this www.hrfolks.com research.

Opinions and related scores in measuring Knowledge Cultures

(3) Knowledge supported technological capabilities; systemic infrastructure is an essential effectiveness factor Computing facilities, networking connections, electronic communication becomes a fundamental necessity for knowledge management. Off site and on site physical working place and business performance locations add value to the quality of contribution and all form a part of the infrastructure. For knowledge to make meaningful contribution to individual effectiveness organizations need to take cognizance of advanced computing and communication infrastructure capable of delivering information across people distances in an easy to understand, interpret and download. The creation of a knowledge bank supported technologically, a distribution network that links a chain of logical users and a logistics platform that makes use of people, capabilities, information and experience is necessary. Links to such a connection would become more useful as data stored is largely standardized with a logical downloading capability. For example, key word search would make usage of the system popular. Leading the corporation more as a member serving the needs of the team fulfilling the demands of the performers and ensuring that the knowledge sought is obtained is critical to sharing electronically. Making knowledge available, facilitating the team to a set path goal orientation, helping the dissemination and filtration is a prerequisite for knowledge management. (4) Content, Corporate Knowledge Bank, Data Mining Memory and Problem Grasping and Solving Capability The core issue of knowledge management is to place knowledge under management remit to get value from it — to realize intellectual capital. Several issues confront the management on a day-to-day basis: ● The company needs expertise available in the first world to solve this critical colour fastness problem. Is it possible to get them to our country to help solve the problem? ● There is attrition of a severe nature owing to competition growing at an equivalent pace, how do we capture and reuse the knowledge being lost? ● We have just implemented a new project and commenced commercial production when we have received approval for commissioning another plant. How do we learn from the last project experience? HR increasingly is expected to play a role in the identification of the need for information, the need for creating awareness towards the usage of this information, and the availability of technologies to access this information. The Chief Knowledge Officer together with the Chief HR Officer work together to define the organizational computing environment along with the basic human need to absorb and handle vast amounts of data. Their role is to create virtual teaming skills, enterprise problem solving databases and corporate information database. The CEO’s primary challenge is to identify knowledge gaps, those that are known and those that have to be searched, and figure ways and means to bridge these gaps. (5) “Retreat” for Knowledge Gaps Typically knowledge management process involves placing together pieces and a body of information analyzed, absorbed and managed to make usage easy and effective. Its effective usage depends on appropriate capturing, organization and storage, distribution and sharing and application and leverage for mutual benefit. The documented process necessitates internal audits to ensure quality and easy deliverability of the stored compartment. The effective usage is possible with appropriate computer mediated knowledge management.32  Knowledge source and retrieval methods that influence development of the individual. Intranet databases for on-line learning are perhaps the best source for individual development. Lotus Corporation has a knowledge management site that combines theory and case learning from across industries and presents them for their employees and their customers.  Knowledge about demands, work role is assimilated best when acquired through work and performance itself.  People working with information are not producing knowledge unless they are linking and internalizing that information to the creation, analysis and execution of a pursuit or role.  Production of information by itself is insufficient for knowledge management. In contrast converting that information into a value demonstrates knowledge.  Knowledge analysis and presentation to make available source points that impact decision making.  Knowledge deployment and access for organizational management.  Knowledge usage, interpretation, enhancement training. Healthy and high performing organizations create knowledge gaps that are large and engulfing. This is a healthy sign as it indicates the consumption capabilities of the corporate to use and render useless data used up. (6) Team Knowledge Management The ability of an enterprise to manage knowledge as an asset (and provide a return on investment and potential revenue) is seen by strategies such as Agility (Agile Networking©) as the key to survival in a global business environment. An environment in which the efficiencies of mass production of commodity goods have been successfully exported to low wage economics. Team knowledge management supports capture, organize, distribute/share and apply their learnings. Working by wire a concept developed by Dr. John Gundry and Dr George Metes operates on the principle of connecting teams and groups through computer-mediated interactions. They have used teleconferencing and hyperlinked structures to demonstrate the possibility of team effectiveness through management of knowledge. (7) Knowledge Value Sharing and Building/Blocking Blocks  Knowledge is found, created and embedded in people’s mind. While a significant portion of what people know is what the corporation knows about the unutilized opportunity loss on what people know but do not do in their organizations or cannot use or unable to use may mean a significant value loss to corporations.  Knowledge is a value when realized and theory when stated. Often knowledge creators encounter loss of value recognition being dismissed as impractical theory or an idea that lacks application capability.  Exercising expectation on knowledge is like asking an inventor a deadline for his/her forthcoming invention. Knowledge creators in a pure sense are scientists with an original mind and competence to generate the new and the unknown. As a consequence linking results to our expectation of the knowledge is equally a risky proposition.  The need to use partners to create knowledge is an essential knowledge capturing and transmission process. ORGANIZATION OF THE NEW MILLENNIUM IS DRIVING THE FOLLOWINGFACTORS 1. Corporate Attributes of the 21st Century 2. Business blueprint and the new model of the organization structure 3. Structure and Change Management33 4. Evolution of Structures 5. Culture management and knowledge compulsions34 6. Knowledge Human Resource Management35

(1) Corporate Attributes of the 21st Century In April 1990, Matsushita officially announced its corporate vision of becoming “a possibility-searching company.” Under this vision, Matsushita set forth the following four objectives in the areas of business, technology, people and globalization:

(a) “Human Innovation Business”: business that creates new lifestyles based on creativity, comfort, and joy in addition to efficiency and convenience.

(b) “Human ware Technology”: technology based on human studies such as artificial intelligence, fuzzy logic, and neuro-computers as well as on chip systems and networking technology, all necessary for the “human innovation” business.

(c) “Active heterogeneous group”: a corporate culture based on individuality and diversity.

(d) “Multilocal and global networking management”: a corporate structure that enables both localization and global synergy. The model organization outlined below that considers corporate attributes, business blueprint, change, and technology and structures deals primarily on the basis of the vision outlined by Matsushita.

What would you prefer, “A surgeon who is perfect or one who is creative? A perfect surgeon is indeed a necessary condition while at the operating table in the hospital and a creative artist a pleasure when you see Richard Attenborough’s work, Gandhi.” The new millennium brings in organizational people, networks and structures that are not basic or commonplace. Many are at conceptual variance with functional matrix structures seen as proven forms of organizational management over time. Corporate networks in contrast have been in transition from a current to a desired state on many facets of the business, viz., strategy, structure, environment, people, learning style, resourcing etc. In each of these networks mentioned the uncertainty element is paramount. A brief matrix given below indicates the state of transition between current and projected realities of the 21st century. Corporate Attribute

Current Desired

Strategy Structure Horizon People Environment Inspiration Orientation Learning Styles Performance Skills Resource Management Core Competencies Closed Hierarchy Inward Managers & System Maintenance Stable, Sober & Static Rewards Command & Control Direct & Upward Job Skills Financial Capital Systemic & Problem Solving Organizational Competencies Open Network Outward Entrepreneurial Professionals Volatile & Uncertain Commitment & Loyalty Team Based Organization Self-Managed Behavioural Competencies Human Capital Leading & Team Building(2) Business Blueprint and the New Model of the Organization Structure The combination of external and internal forces would as a consequence determine the business management scenario. External force would include global competition, rising

customer expectations, pressure to reduce costs, deregulation and opening of market acquisitions and mergers, pressure to perform and strong IT development and influence. Concurrently internal forces would include re-engineering and down sizing, production of benefits and long-term compensation, product focused mergers and joint ventures, outsourcing of effective service capabilities, more focus on teams and doing more with less will become the internal competitive position. Information to knowledge transition necessitates definition of the information required, clarifying and denoting how will it produce value and make a difference in its application, what methods and alternatives are available to draw an action plan and what further information and data are necessary to complete the loop and bring about value addition to the basic data generated. Fig. 6: Business Blueprint The organization of the new millennium copes with both the external and internal environment. External pressures ranging from increased global competition, rising customer expectations, managing a cost efficient enterprise, aggressive market environment of mergers and acquisitions, liberalizing governmental policies and an unmitigating pressure to perform for profitability and increasing shareholder wealth. Added to this is basic business methodology and processes undergoing radical transformation owing to IT, the Internet and the web. As a consequence corporates have no choice but to focus on what they know best internally and figure means to outsource all other peripheral activities. In addition a process of consolidation of the big and mighty becomes relevant through appropriate mergers and acquisitions for a competitive advantage, changing the way internal teams work and in an overall sense make the internal organization singularly customer focused and make all backward integrated processes customer friendly. This could range from process planning, team working, reward management, re-engineering, optimum numbers etc. Perhaps the most important of all factors mentioned would be knowledge management in the internal environment.

The Business Blueprint attempts to bring to focus key factors amongst several variables that in our opinion would affect the business functioning. The business blueprint in turn leads us towards designing a structure that fits well with the strategy as well as the process and business priorities. (3) Studying Structure and Change Management36 Creating the structure may necessitate studying what implications are likely to affect the structure. Some of which are mentioned below as potential factors that would impact structures: 1. Intellect as a basic unit is inevitable. The organizations should be driven, managed and determined by those who possess the intellect to forecast, foresee and lead the corporate unit. Domination of the human mind to perform corporate critical activities presupposes that the company would compromise other systems and roles to help the mind determine performance goals. 2. The organization should be densely networked with singular (individual specialists/policy influencers) and multiple variables (people groups, technology, vendors, customers etc.) linked with the environment. The environment in this context would turn all-pervasive and would include and exclude the appropriate variables depending upon the context. Context has relevance, applicability and user friendliness. Development process innovations (improved delegation patterns, team working, group reward programs etc.) are applicable across a wide set of organizational factors that determines performance. 3. Information flow will lose a sense of proportion, a rational congruence and will make itself available in all directions and paths. (Everybody would demand everything). 4. Linear organization charts that include delegated lines of authority would turn outdated and decisions would be made at the point of information origin. The last person the line of hierarchy decides. 5. Corporate hierarchies would turn into “intellect hierarchies”, positions of leaders and managers held by those with a know-how, know-what and the know-why, rather than an upgraded position in the hierarchy made available through a corporate career plan. This is inevitable, as the possibility of one intellect supervising another would mean severe management complexities. 6. Flexible workdays, part time decisions would become common with employees determining work goals, work content and work methodologies depending upon the technological infrastructure available for effective performance. 7. Career paths would not be straight or linear; careers would turn flexible, lateral moves will become inevitable for people to grow in organizations and would make horizontal growth that is knowledge intensive and real. Career paths would create comparable performance yardstick, meaningful measures and performance evaluation would insist on customized evaluation process and tailor made compensation reward program. 8. The organizational population will turn increasingly diverse in social and cultural milieu, perspectives, viewpoints and behaviour, competing and at times conflicting and this would be a part of the everyday workplace. 9. Increasingly organizations would turn specialist and focused with small meaningful structures that offer end-to-end customer satisfaction and profitability. 10. The current corporate environment in a local geography would transform into a global geography and make corporate compete in a horizon beyond their doorstep. 11. A static pyramid with top down communication will change into dynamic mesh for communicating coalitions. These coalitions will be small groups, as managing teams that would be empowered for problem solving and decision making. The structure would be widely spread out cutting across board and will transcend into hitherto built in functional boundaries. 12. Hierarchy based on experience and a seasoned work force will transform itself into an intellect hierarchy based on knowledge gained and applied for current performance effectiveness. 13. Relationships that are of a reporting nature in today’s scenario where accountability is vested in jobs will turn into responsibility vested in people and their relationships. Jobs by themselves, unless the job descriptions are deeply entrenched with the overall business strategy, would turn meaningless given the dynamic set of change that would affect the business scenario on day-to- day basis. 14. Change management involves several sets of players including people concerned with the change process, those concerned with improving the method and consequent process and those who would facilitate the change process from both internal and external environments. 15. Change programs could typically follow the Ernst & Young LLP design of : ● Awareness building ● Vision setting ● Readiness assessment ● Transition planning ● Transition management ● Pathfinder projects ● Infrastructure building Current day players like Chief Executive officers, managers and executives, possess role descriptions, job definitions, key result areas would turn into a corporate orchestrator, innovators, champions and sponsors. Evaluation of structure from heavy corporate management supervising independent business units with a Blue collar work force will turn into several subsets of individual business units interconnected with each other through mutual interdependence and collaboration and will be supported by a lean specialist staff of corporate management juxtaposed with knowledge creation would typically turn into the organization of the future. The knowledge creators in contrast of today’s organization would manage this new organization where the knowledge managers supervise knowledge creators.

(4) Evolution of Structures The evolution of structures from a simple entrepreneurial/functional structure to that of a divisionalised matrix structure was the first step in the evolution. In the current form strategic business units would undergo changes to make organizations more self- sufficient and self-managing, yet without duplicating specialist structures that are not easily substitutable, managed out of a core corporate apex. This form of organization is the Individual Business Units (IBU). IBU means the following: 1. Individual Competence Based Power Structures with unlimited freedom to do business. This includes strategy formulation and execution. 2. Governed by a lean Corporate Staff that is yet another Individual Business Unit (IBU) offering services at a price and based on competitive market dynamics. 3. IBUs would do what they know. Rest would be farmed out. 4. All businesses operating as IBUs with businesses only to do with what is identified as core competence. 5. All supportive and peripheral activities are outsourced or left to another IBU of the corporation. 6. Each IBU is a profit center with a team reporting structure with the CEO along with other IBU heads. 7. The sum total of the organization is the SBU. Whereas each IBU has focus and profit goals, they would still have to necessarily share knowledge and resources with other IBUs. 8. The corporate management is the CEO and a set of specialist staff that would act as his strategic advisors only. 9. Organizational workflow and planning are decentralized with a strong IT architecture integrated across the company. Duplication is avoided with a common database of information. (Suppliers/Customers/Vendors/Bankers/ Technology/ Vision/Values and Business Philosophy). 10. The corporation is one large best practices sharing culture. (5) Culture Management and Knowledge Compulsions The new organization of the future38 produces best business results in a culture that is strong with an effective strategic fit and adaptive to changing circumstances and compulsions. (A) Culture: Visible Elements of the Culture: ● A mission statement, company philosophy and history ● Articulated values, core principles and ethics

STRUCTURE — THE EVOLUTION CURRENT ● Stated ways of working, business concerns and priorities, business ethics, and basic management styles ● Terms of employment that offer space for the knowledge worker ● Forms of organization which encourages connectivity ● Networked relationships ● Clarity in location of authority and the power to do things ● Approaches to decision making ● Encouragement of diversity and varied points of view ● Commitment to learning ● Articulated position of premium or knowledge and intellect ● Basic sensitivity to values and feelings. (B) Culture: Determining Criteria ● Consistency between core values and actors ● Orientation of new employees to core values ● Team based projects to problem solving, decision making and doing things together ● Trusting, caring and mutually depending as basic to norms of work, behaviour ● Secular and gross tolerance for diversity ● Encouraging innovation and sponsoring efforts to do things differently ● Achievement motivation and individual contribution ● Unbiased information flow across the channels ● Use of selections, rewards, processes for a tight fit between employees and organization ● Formal management development program reiterating commitment to self- development ● Careful and yet planned succession planning and growth ● Critical investment in human capabilities. (C) Culture: Managing Competencies Desired Attitude/AbilityCore ValuesCritical Competence/Skill Global Vision and broad picture of the business scenario Knowledge Managing Competition and unpredictable forces Uncertainty and unpredictable future, several contradictions, data lacks consistency. Forecast future needs and activities Conceptualization Managing Complexity and unknown forces. Past data not available to validate decision Comfort with method, Process activities, following details, procedures Flexibility Managing adaptability, cultural acceptability, easy socialization Diverse teamwork, cross-border workrelationship, organization of teams, strong interdependence and need to work together for goal achievement Sensitivity Managing teams, facilitating group behaviour, getting things done. Change as opportunity. Willing to make change happen for self and others Judgment Managing uncertainty and ambiguity Openness to surprises Reflection Managing learning Developing People Listening & communicating Managing teaching and training Evaluation People Judgment and analysis Managing planning ambiguity, ability to design goals.

(D) Culture: Transformation

From diversity driven to institutionalized system from sub cultures to cross cultural integration, from activity by rote to activity by innovation, from line staff stereotypes to business champions, from empowered to responsible and empowered and sustaining a team based family feeling. Transformation occurs when there is a shared commitment to open an extensive communication.40 (E) Culture: People

From managing the affairs of managers of information, from dogmatic to innovative, from creating policies to creating databases, from suspicious mind set to networks of trust, from competitive to competitive positioning, from power influence to influencing through knowledge, from authority of position to authority of knowledge. (F) Culture — Leadership Roles

The influence of leadership in knowledge cultures is quite intensive and involves multiple roles as we see below:

Orchestrator is the First Management Role

(a) Ecovisionist as an Orchestrator:

Orchestrator leads and manages the organization. Ecovisionist looks at the internal and external environment needs and demands. The Ecovisionist is responsible for managing relationships between organization and the environment. The role encompasses managing in-built complexities in interacting to vital focus of tomorrow’s world. The organizations purporting to work without giving any return to the environment are unlikely to be successful. The Ecovisionist has the ability to renew realistic identities enhancing organizational functions and capabilities. The Ecovisionist considers mission, performance goals, synergizing corporate and community goals making mutual benefit possible. In addition the Ecovisionist plays a role of the navigator of corporate compass charging the path of the vessel, as a rough water sea would warrant. The Ecovisionist is an Orchestrator.

(b) Coach as an Orchestrator: The coach is the bridging factor between the reality of today and the mission achievement. Outlining the stages to growth, the coach facilitates realization and internalization of the experiences and creates a platform for each successive growth stage. Unlike a manager or a supervisor, the coach observes the employees who actually play the corporate game and guides them into higher capabilities.

The traditional supervisory role envisages goal setting, review and feedback for corrective action. Developmental inputs for the subordinate were provided through training capabilities or formal training inputs. The role demands for the Orchestrator as a coach envisages him/her to be a body of knowledge that stresses on learning and competency development and is able to provide the requisite competency development inputs. The coach too is now an Orchestrator.

(c) Steward as an Orchestrator: The Steward is a person who leads from the front. He is like the captain of the ship whose main objective is to steer the vessel to its destination facing all situations that might be encountered. A steward provides the direction and the vision for the followers. In leading the people he also has the larger organizational goals in mind. He charts out activities keeping in mind the short and long- term strategies of an organization.

The steward owns and demonstrates ownership of the organization’s objectives. For the Steward, risk taking ability, sharing of success and accountability for failure are considered to be critical skills. One of the key roles that HR has to perform is the development of the Orchestrator for the future, which bear the Ecovisionist, the coach and the steward attributes. The leader’s success depends on those who are being led, not by leading alone, and here again, in terms of structuring roles and organization and people building, lies the crucial role of HR. Champion is the Second Management Role Champions are basically idea generators who possess the basic characters of self- confidence, persistence, and energy, are not risk averse, they have no reverence for the status quo and the “maintenance” jobs; possess in-depth knowledge and a competitive vision.

The performance measures for the champions are innovation and ideation. Environments that foster their creativity sustain them. These are perhaps motivated not by remuneration but the content and excitement of their work itself. For HR, managing such champions is a crucial role. Recognizing their achievement motivation and providing the facilitating environment, opportunities for learning and experimenting and freedom of creative expression will be HR’s role in facilitating the champions. Indeed, the organization where champions abound will resemble a mammoth research center. Sponsor is the Third Management Role Creativity for creativity’s sake is not enough for the organization. Translating the creativity effectively into a deliverable will result in organizational growth. The sponsors provide this balancing element. The sponsors are entrepreneurial in nature and take ownership for execution of the ideas of the champions. Empowerment for independent execution is given. Sponsors work as sounding board managing the idea generators, culture and develop their skills, continue to have a feel of the task and goals and possess basic capabilities to make deals and negotiate contracts. They translate raw ideas into commercially viable and economically value adding services. The role of HR is to nurture a group of sponsors who possess the entrepreneurial capability. In addition, HR has to recognize and facilitate the speed of response, independent action and knowledge environment required by the sponsors.

The leaders of the new organization come in with pride and operate with trust, credibility, fairness and mutual responsibility as basic tenets of management and involve employees at all levels for mutual learning and contribution. (6) Knowledge Human Resource Management41 HR roles have undergone a change. In the changed context HR managers would be expected to manage: 1. Knowledge Values 2. Knowledge Climate 3. Knowledge Systems 4. Knowledge Culture 5. Knowledge People 6. Knowledge Shop Floor 7. Knowledge Customer.

A brief articulation of what do they stand for in the context of a HR manager is outlined below: Fig. 9: Knowledge Center in an Organization

(I) Knowledge Values ● Commitment to Learning: This value does not imply a raw acquisition of knowledge as much as it does a willingness to learn from every experience, accept candid feedback from all quarters, and demonstrate learning through improvements in implementation of every new business endeavour. ● Intellectual Integrity: This is like saying, “Doing an honest day’s job.” Intellectual integrity implies using one’s knowledge judgment rightfully to question actions taken without thought. ● Respect for Intellect Propriety Rights: An organization that harbours knowledge values will strongly respect copyright and patents. ● Innovation Orientation in All Actions: No activity, task or project is done because ‘We do it this way.’ The knowledge value organization questions all actions to ask ‘Is there a better way of doing things.’ ● Dignity to those who know and who make the intellectual difference. A premium is attached to one who has worked, deliberated, created a knowledge bank. The culture implicitly respects such an individual for making him and the organization competitive. ● Share knowledge and cherish the act. No longer would people want to hold on to their knowledge as power. As they give more to others they create more space in their minds to acquire more knowledge. In any event what one shares another would share within a given time. The time value of knowledge is quite limited. ● Create the need and urgency for knowledge as a value for competitive advantage. While people are competing they realize the urgency to acquire knowledge that would make them more competitive. ● Offer a premium for people with exceptional intellectual value and contribution to the corporation. (II) Knowledge Climate and Culture The explosion in information technology and its consequent interface with convergence in communication, telecom, media, television, Internet and the World Wide Web have meant a new way of looking at dealing with human interaction. People in geographies not connected with the corporate headquarters are now in touch over teleconferencing facilities. CD Rom and multi media have made face-to-face transaction simulated for real. GroupWare and information based networks are making exchange of thoughts and views transparent and upfront. Many corporations now realize that hierarchies and structures by themselves connected by reporting lines and role clarity are not making breakthroughs in building people relationships. But the new communication capabilities, complementary skills and knowledge, interdependence on jobs owing to teams have begun to break down cross-cultural barriers. They are now in turn encouraging sharing of valuable tenets of knowledge, experiences and practices in such a way as to encourage mutual learning, eliminating inexperienced pitfalls and all across geographies and physical distances not managed before.

● From process focus to content focus: From a mere ‘This is our policy’ approach to a thoughtful ‘This action impacts the organization and individual thus....’ ● Provide resources to advance knowledge. For example, organizations may have to create policies stating that employees are permitted to browse on the Internet for two hours daily for their personal development. ● Create opportunities in budgets for knowledge augmentation. Annual budgets will have to provide for corporate and functional knowledge upgradation to counter obsolescence. ● Make organization a model laboratory by encouraging learning and experimenta- tion. ● Foster excellence conspicuously through reward schemes focused on learning, improvement and knowledge as against numerical achievement. Stress on the way results are achieved and not just how much has been achieved. ● Link organizational research to knowledge quotient. (III) Knowledge Systems There is a need to identify management and process systems that would help connect managerial information into subsystems. While traditional database management systems would be useful from a commercial perspective, a set of databases specifically to enable knowledge management is outlined below.

Following is a set of principles of making this database work for the corporation:

● Manage data base towards: ● Customer information ● Vendor information ● Innovation database ● Learning database ● Success, experience database ● Design, development database ● Technology database ● Process database ● Employee database ● Environment database ● Financial performance ● Competitor benchmarks ● Base performance standards and key tasks ● And, Corporate database, which in turn includes: ● Mandate document of experience to make available on an on-line system. Ensure no problem solved is left without documentation. ● Define propriety and protocol for knowledge usage and reorder in a form that makes the intended recipient use effectively. ● Make organizational information system as tangible measure of organizational learning. ● Design training systems on specifics related to knowledge usage, change management, fear of information overload, decision making dynamics in the changed environment, IT friendliness, group dynamics, research methods ● Turn information into actions ● Design specific documentation procedure and appropriate training ● Computers and on-line access to Internet have become invaluable in enhancing training ● Make data warehousing mandatory for all data generating functions ● Create call centers for on-line customer management at the earliest. (IV) Knowledge Culture ● Premium and respect for the intellect and not at the cost of their ethics ● Sharing in the data and information across the organization networks ● Measuring and recognizing corporate human capital assets ● Develop knowledge systems systematically and eliminate individual indispensability ● Make success experience sharing and documentation a way of business life. Make sharing a proud and meaningful experience ● Institute rewards to education and formal learning programs ● Make project experiences, task force participation, group work and assignments mandatory as a part of the career planning process ● Make people data friendly by linking meaning and relevance to the performance goals. (V) Knowledge People ● Learning goals should make yesterday’s information obsolete today ● Investment in knowledge management methods should result in a demonstrable and measurable increase in employees’ skill levels ● Create infrastructure for self-development and on-line/virtual training ● Reward for knowledge gains and sharing ● Individual growth linked to knowledge acquisition ● Mind count not headcount ● Virtual organization ● Global networks ● Borderless structures ● Knowledge dissemination hotlines for employee involvement.

(VI) Knowledge Shop Floor

● Lean and effective self-managed work force

● More management of technology

● Less management of people and operations causing negligible supervision

● Innovation and team based rewards

● Computerized integrated manufacturing

● Learned and enlightened work force

● Elimination of the command and control management style

● Law and legal management methods have no place

● Empowered team structures.

(VII) Knowledge Customer (Internal/External

● On-line information to customer

● Innovate customer service charters periodically

● Customer feedback as base for company’s performance assessment and evaluation

● Customer loyalty as a measure for sales and service training and managerial effectiveness

● Customer satisfaction as a prerequisite for HR utility and value

● Make employee information as a part of the corporate Intranet

● Create Call Centers for on-line problem solving

● Make policy, forms and HR systems easy and user friendly on a ready to use basis.

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