The Hindu Business Line : Synergy is the key

IT must offer data and information processing capacity. And the workers of a company must put in their creative and innovative capacity. This synergy will keep the wheel moving.

A GOOD many companies in India which have pumped in serious money into information technology (IT) have — whether they admit it or not — found themselves wondering whether their investments have paid off in terms of performance.

If they haven't, the chances are that they haven't put in place knowledge management systems and practices and that, as a result, have succeeded only in reducing their people to passive recipients of technology.

Knowledge management, knowledge organisations and knowledge workers became the focus of intense debate in the US when that country's economy was shifting away from the production of tangible products and toward intangibles such as services and software. At about the same time, US companies found to their chagrin that their workers (trendily designated as knowledge workers, presumably to differentiate them from the ignorant hard hats types), who had helped them create wealth, were no longer inclined to be `loyal' and that they were switching jobs much more frequently than the preceding generations. Quite simply, they discovered that they could no longer rely on their `intellectual resources' to stay put - and that they had neglected to work out a way of `capturing' worker knowledge.

Enter knowledge management ... in the West, that is. Indian companies, many of which function on the basis of the premise that the only knowledge required of employees is that they pretend to be dumber than the boss, plodded along, wondering why their investments in IT weren't making ubermensch out of their underlings.

Be that as it may, there is no doubt that domestic enterprises, faced by a complete bankruptcy of knowledge and ideas, will, some day, understand the value of the knowledge held by their employees.

In the meantime, they would do well to study the writings of Dr Yogesh Malhotra, an authority on technology and innovation management, business performance, and corporate strategy issues related to information systems, knowledge management, e-business and electronic commerce, business decision models, and new organisation forms.

Dr Malhotra defines knowledge management as an embodiment of processes that caters to the critical issues of organisational `adaption,' survival and competence in face of increasingly discontinuous environmental change.

"Essentially, it embodies organisational processes that seek synergistic combination of data and information processing capacity of information technologies, and the creative and innovative capacity of human beings."

He maintains that this is a strategic view of knowledge management that considers the synergy between technological and behavioural issues as necessary for survival in `wicked environments.' The need for synergy of technological and human capabilities is based on the distinction between the `old world of business' and the `new world of business.' Within this view, the `old world of business' is characterised by predictable environments in which focus is on prediction and optimisation-based efficiencies. This is the world of competence based on `information' as the strategic asset and the emphasis is on controlling the behaviour of organisational agents toward fulfilment of pre-specified organisational goals and objectives. Information and control systems are used in this world for achieving the alignment of the organisational actors with pre-defined `best practices'. The assumption is that such `best practices' retain their effectiveness over time.

In contrast, the `new world of business' is characterised by high levels of uncertainty and inability to predict the future. Use of the information and control systems and compliance with pre-defined goals, objectives and best practices may not necessarily achieve long-term organisational competence. This is the world of `re-everything,' which challenges the assumptions underlying the `accepted way of doing things.' This world needs the capability to understand the problems afresh given the changing environmental conditions... ."

Dr Malhotra goes on to point out that the focus now is not only on finding the right answers but on finding the right questions. This world is contrasted from the `old world' by its emphasis on `doing the right thing' rather than `doing things right.' Thus, knowledge management is a framework within which the organisation views all its processes as knowledge processes.

Further, this concept embodies a transition from the recently popular concept of `information value chain' to a `knowledge value chain.'

The information value chain considers technological systems as key components guiding the organisation's business processes, while treating humans as relatively passive processors that implement `best practices' archived in information databases.

In contrast, the knowledge value chain treats human systems as key components that engage in continuous assessment of information archived in the technological systems. In this view, `best practices' are not implemented without active inquiry by the human actors.

Human actors engage in an active process of sense-making to continuously assess the effectiveness of `best practices.' The underlying premise is that the `best practices' of yesterday may not be taken for granted as `best practices' of today or tomorrow. Hence, double loop learning, unlearning and relearning processes need to be designed into the organisational business processes.

Knowledge management, Dr Malhotra points out, is necessary for companies because what worked yesterday may or may not work tomorrow. Elaborating on this in a media interview, he says: "Considering a simplistic example, companies that were manufacturing the best quality of buggy whips became obsolete regardless of the efficiency of their processes since their product definition didn't keep up with the changing needs of the market. The same holds for assumptions about the optimal organisation structure, the control and coordination systems, the motivation and incentive schemes, and so forth. To remain aligned with the dynamically changing needs of the business environment, organisations need to continuously assess their internal theories of business for ongoing effectiveness. That is the only viable means for ensuring that today's `core competencies' do not become `core rigidities' of tomorrow.

Obviously, effective knowledge management requires that companies focus on what Dr Malhotra describes as "the synergy of data and information processing capacity of information technologies, and the creative and innovative capacity of their human members."

Advanced information technologies can increasingly accomplish `programmable' tasks traditionally done by humans. If a procedure can be programmed, it can be delegated to information technology in one form or another. The information and control systems in organisations are intended to achieve the `programming' for optimisation and efficiency.

However, Dr Malhotra cautions that checks and balances need to be built into the organisational processes to ensure that such `programmes' are continuously updated in alignment with the dynamically changing external environment.

pratapravindran@hotmail.com

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