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Sunday, April 04, 2004
 



The Burning of Parliament (J. W. M. Turner, 1834)

Knowledge Management and Strategy

I believe that my friend and collaborator Mark McElroy (2001) was the first to point out the inherent conflict in the very popular, but we think mistaken, idea that Knowledge Management should be aligned to organizational strategy and that its purpose should be to mobilize knowledge in the service of it. But whatís wrong with this widely held idea? Isnít knowledge just a Ďtoolí or instrument of strategy and KM just a method of upgrading the quality and effectiveness of the tool? And doesnít this mean that KM is itself just a hand maiden of Strategy? Well no, not really. Things are a bit more complex than that.

The Three-Tier Model: Where Is Organizational Strategy?

It may be helpful to keep in mind the distinctions made in The New Knowledge Management's three-tier model (See Figure 1). The top KM-tier includes process activity and process outcomes aimed at enhancing the way we perform problem-solving (where we define problems as "knowledge gaps") processes in the second, knowledge processing tier. This tier, includes process activity and outcomes aimed directly at solving problems originating in process activity in the bottom tier. This tier includes all other process activity and outcomes including all non-KM management activities.

Figure 1 -- The Three-tier Model

So, here is a three-way distinction that is very important to thinking through the scope of KM. "Doing", including everything outside of KM itself that uses knowledge to attain strategic goals and objectives, mostly occurs in the bottom-tier. "Learning" (in the sense of problem-solving) and integrating the outcomes of learning mostly occurs in the middle-tier. And Knowledge Managing, which includes both "Doing" KM, and "Learning" about how to do "learning" and KM, occurs in the top-tier.The middle-tier is where the responsibilities of management, in general, and KM, in particular, meet. KM has the responsibility for enabling knowledge processing in the middle-tier, but the knowledge workers who perform middle-tier processing are responsible to managers, other than knowledge managers, for their performance of operational business processing including their use of knowledge in that performance. So, where is strategy?

Organizational Strategy (excluding KM Strategy), considered as a process, is a bottom-tier phenomenon in the three-tier model. It can occur only after strategy, considered as a network of knowledge claims, is created through knowledge processing in the middle tier. The KM component of organizational strategy, on the other hand, is performed in the top-tier, as is knowledge processing creating KM strategy.

Organizational Strategy is about setting goals and objectives for the organization and specifying high-level plans for getting there. But KM strategy is not and cannot be about achieving any of these goals or objectives, because the production of specific goal and objective-oriented knowledge that would be effective for fulfilling strategy is not the kind of result that can be caused and therefore planned by management, knowledge or otherwise. Instead KM strategy focuses only on organizational goals and objectives related to performing KM and enhancing knowledge processing (including knowledge processing at the KM Level). Its goals and objectives should be limited to enabling knowledge processing,and the self-organization of knowledge workers around problem solving and knowledge integration, that alone can bring sustainable adaptive success.

The Conflict

The idea that Knowledge Management should be aligned with organizational strategy, and that therefore Knowledge
Managers should be subordinate to managers concerned with fulfilling the goals, objectives and plans of strategy carries with it an irreducible conflict that harms not only Knowledge Management, but also, knowledge processing, operational management and operational processing, as well. The conflict arises from the three-tier model.
Hereís an outline of its dimensions.

  • It is the purpose of KM to enhance knowledge processing and its outcomes. Any organizational authority structure that prevents knowledge managers from performing their role of enhancing knowledge processing reduces their effectiveness in maintaining and adding to the adaptive capability of the organization. So, any organizational arrangement mandating (for knowledge managers) a higher priority for strategic goals at the expense of the KM goal of enhancing knowledge processing will reduce the effectiveness of KM in accomplishing its primary goal.
  • It is the purpose of knowledge processing to produce and integrate knowledge, including the organizational strategy that is implemented in operational business processing. Any organizational authority structure that prevents knowledge workers, including managers, from performing their problem solving role reduces their effectiveness as knowledge producers, and indirectly the effectiveness of operational processes as well. So, any organizational arrangement mandating (for knowledge managers) a higher priority for strategic goals at the expense of the KM goal of enhancing knowledge processing, will also generally result in less effective knowledge production.
  • It is the purpose of operational processing to fulfill strategy, and to manage and perform the day-to-day work of implementing operational processes and attaining the goals and objectives of the organization. Any organizational authority structure that prevents managers charged with implementing strategy and operational processing from performing their roles detracts from the effectiveness of the organization. So, any organizational arrangement mandating (for knowledge managers) a higher priority for strategic goals, at the expense of the KM goal of enhancing knowledge processing, will generally detract from operational managersí performance in their roles. It will do so because it injects Knowledge Managers into operational processes by involving them in issues of knowledge use, an area of responsibility of operational management.

To see the conflict more clearly, consider the following questions. What if strategy doesnít work, what if it turns out to be mistaken? And what if the managers who are attempting to implement an erroneous strategy wonít accept that it is erroneous. What if they require knowledge managers to "adjust the rules of knowledge making", so that knowledge workers will neither find nor seek a better strategic solution; but will, instead, devote all of their energies to learning better ways of executing a counter-productive strategy Ė one destined to produce bad results, regardless of how well it is implemented? These questions are close to being rhetorical, but they still illustrate the main points.

There is a KM function in organizations and it should not do knowledge processing in response to operational problems ultimately related to strategy, or attempt to command such knowledge processing. There is a knowledge processing function in organizations, and if KM adjusts its rules in order to save a favored set ofknowledge claims, its adaptive function, along with the adaptive function of the knowledge workers who perform it, will be compromised. Lastly, there are many operational business processing functions in organizations, and if KM adjusts the rules of knowledge making so that the strategic solutions that are closest to the truth are not produced by knowledge workers, and therefore are not available to managers and workers who need to use knowledge in business processes, the general result will be a decline in the effectiveness of operational business processing, not a happy result for investments in KM.

Why?

If it is true that the principle that KM should be aligned to organizational strategy has such a plain inherent conflict, then why is it that KM practitioners donít acknowledge the conflict? Why is it that they, instead, continue asserting that the first step in establishing a KM program is to create an alignment with organizational strategy? I think the answer is that they donít distinguish among Knowledge Management, Knowledge Processing, and Knowledge Use, and donít visualize KM-related concerns in terms of the three-tier model. They therefore confuse operational business management interventions, focusing on how previously produced and integrated knowledge should be used, with KM interventions focusing on how knowledge production and integration may be enhanced. It is Knowledge Use, occurring in the bottom-tier of the model, that should be aligned to strategy, and Knowledge Processing that may be performed in support of strategy provided that the problem or problems initiating it do not call strategy itself into question. But, again, KM should never be aligned with any aspect of organizational strategy, except KMís central function of creating and enhancing sustainable knowledge production and innovation.

The Implication

The idea that KM is independent of strategy and should not be subordinated to it has an important implication, also first pointed out by Mark McElroy.That implication is that KM is a fiduciary activity in organizations that must not be under the line authority of those, including the CEO, who make and enforce strategy. In private sector organizations, both profit and non-profit, KM should, like the CFO, be responsible to the Board of Directors. In the public sector, KM, like other fiduciaries, should be responsible to the legislative authority.

I know that, given the historical development of KM, this implication of the relationship between KM and strategy will make many of you groan. Itís tough enough to sell KM, you say, without having to tell the "powers-that-be" in your organization that they need to establish the KM function as independent of their own authority, rather than as their faithful servant. In response, all I can say is: there exists a management process, or set of management processes, in organizations that can create and enhance sustainable innovation. Call it (or them) KM, or call it something else, it still exists. If you want to practice it, you have to recognize that its "best practice" can only be accomplished if it is independent of, and autonomous with respect to strategy, and that implies that it should have fiduciary status. So there it is. If you want to practice KM, as opposed to practicing knowledge use management, you need to make the case for its independence and autonomy.


4:44:37 PM    comment []


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