RIP: ROI

There have been numerous discussions about how to evaluate social software implementations, and the shortcomings of ROI and reductionist models for illustrating ’success’ in terms of bottom-line profitability (e.g. Why Bother with Social Software, Musing About the Value of Social Software, Calculating the ROI of Blogging).

Because traditional financial accounting measures like ROI give misleading signals about continuous improvement and innovation, more integrated approaches to performance measurement are needed.  An obvious candidate here is Kaplan & Norton’s Balanced Scorecard (BSC), which assess performance from the perspectives of (i) staff development/learning (ii) internal processes (iii) customer service and satisfaction and (iv) financial effectiveness, efficiency and cash flow.

The different perspectives of the BSC can be linked by outlining a ’story’ of the social software implementation.  That story also helps test the thinking/assumptions behind a project’s goals and what exactly should be measured or evaluated.  The underlying logic of the story would be along the following lines:

• If we increase the capability of our staff to connect with information, expertise and colleagues and/or clients

• Then they will be able to improve and innovate our products, services and processes

• Then the customer will be delighted and customer loyalty will improve, and

• We will keep/get more business, which has a positive impact on our finances.

The beauty of the model is that it provides a more visual flexible approach to project evaluation, and moves away from a restrictive quantitative approach.  It allows the focus to shift from time to time depending on the business strategy, and for the nature of measures to change overtime, depending on people’s information/social networking needs and the (adoption) phase of the implementation.

That shifting relationship is the subject of Mark Gould’s post “Measuring Maturity“.   In his post, Mark cites the following scenario by Jonathan Wolff highlighting the relationship between experience, measures and proxies:

Suppose you have applied for a job, any job. You are at one of those macho interviews where the panel members compete to see who can make you sweat the most. And this is the winning question: how do you plan to monitor and evaluate your own performance in the role? …

Suppose your job is in business of some sort and, ultimately, you are employed to make the company money… In the end, the only thing that matters, then, is the profit you bring in. But it may take some time to build up a client base and to gather the dosh. It would be foolish to say that in the short term you should be judged on how much profit you make for the company. Rather you should monitor your activity: how many meetings you have taken, how many letters and emails you have sent, how many briefings you have been to. But, of course, that is only for openers. If the meetings don’t result in business, then you are wasting your time. So in the second phase of monitoring, you stop counting meetings and start counting things like contracts signed, goods shipped, turnover generated, or any other objective sign of real interaction.

But, once more, this is only an interim goal. You are there not to generate turnover, but profit. And once you have been around long enough that is the only thing that matters. In the third and final phase you count how much you make for the company, and stop worrying about meetings, letters or contracts signed. Who cares about how many of these there are if the bottom line stays juicy enough?

There are several messages here about taking account of the right things, and how those things change over time as people, technology and processes mature.  This resonates with Bessant’s Continuous Improvement (CI) Maturity Model (2001), which was based on extensive research exploring how high involvement in continuous improvement can be built and sustained as an organisational capability.  The model facilitates assessment of progress in the evolution of behavioural changes necessary to establish innovation routines in business.  It emphasises that effective management of the process depends upon seeing CI not as a short-term activity “but as the evolution and aggregation of a set of key behavioural routines within the firm”.  As CI practices in firms mature and become more systematic, strategic and autonomous, there are flow-on effects for performance which drive improvements measurable in terms of bottom-line impact, major innovation and incremental problem solving.  But, these improvements accrue incrementally, with co-ordinated management support, and appropriate on-going assessments of the organisation’s structure, systems and processes.

So what’s the upshot of these models for social software implementation evaluation and measures?

Adopting an holistic approach to evaluation, based on the multiple BSC perspectives, will highlight a range of behaviours and outcomes which need to be targeted, not just the financial ones.  Those measures will change overtime depending on the phase (or maturity) of the implementation, and improvements to routines and learning within the organisation.  Taking a staged approach also helps in working through the different phases associated with the adoption of new technologies, and thinking about types of behaviours and outcomes necessary for progress in the future.

Early measures may include simple activities like number of pages created or edited, number of posts, comments or views, or number of (different) users contributing content, reduction in email volume and associated time savings (e.g. fewer distracting blanket emails).  However those measures only give part of the picture - they do not indicate why people are doing what they are doing or what the effect of the behaviour is on organisational structure, culture and profitability.  So, as the implementation matures, it would be useful to assess changes (if any) to organisational routines, levels and structure of communications, and workflows, as well as asking people about the attitudes and behaviours behind their activities.

But, connecting these qualitative (’soft’) measures to any improvements on the balance sheet is key.  That’s a reasonably complex question best left for a future post. For now, let me close with a thought from Mark Clare (2002 ) (cited in Anthony Rhem’s blog: Realizing ROI in KM Initiatives) about the way to estimate the value of intangible benefits and related them back to cashflow:

The value created from managing knowledge [or other social/information networking programmes] is a function of the costs, benefits and risks of the … initiative. Thus mathematically stated: Initaitive Value = F (cost, benefit, risk), which equals Total Discounted Cash Flow (DCF) created over the life of the … investment.

This is just one formula which could be used to enhance the BSC - let me know if you have any others!

IT that learns

Yesterday, I mentioned how Cleary Gottlieb had borrowed knowledge engineering techniques from the military, to capture the expertise of senior staff, embed it in a computer system and pass it on to junior lawyers online, in the form intelligent online textbooks and knowledge maps. But I was left wondering about the system’s interactivity, intelligence, and the currency of information therein.

Today, having read about iLink - another military-funded project - I’m now wondering if the Cleary Gottlieb system incorporates any of the social-networking ‘AI’ features mentioned in that article (given the military connection!)?

iLink was developed as a part of the SRI-led CALO (Cognitive Agent that Learns and Organizes) programme and was funded and managed under DARPA’s PAL (Personalized Assistant that Learns) programme.  Mark Rutherford reports that:

iLink is a machine learning-based system that models users and content in a social network and then points the user to relevant content, discussions, and other network members with shared interests and goals across a broad range of scenarios.

To do this, the system uses message-matching technologies for finding related information, and algorithms for gathering data from multiple sources and compiling it together, whilst differentiating private information from that which is safe to share.

Now certain of those technology features/capabilities don’t sound too removed from some social software tools currently on (or almost ready for) the market.  For instance there’s:

• Newsgator ES - has smart feeds and recommendations.
• PagesPlus - allows content to be pushed out to the categories and pages corresponding to the tags, and to the users who are subscribing to feeds from those categories.
• IBM’s Beehive - currently in the research phase - with the capability to ‘recommend’ connections based on activities, tags, bookmarking, etc.
• Zemanta - blog posts, articles or web pages are directly “read” by Zemanta, which recognizes all contextual content. It then combs the web for the most relevant images, smart links, keywords and text, instantly serving these results to the user to enrich and inform their content.

Nevertheless, it is iLink’s learning capabilities, and SRI’s work in modeling how real-time, dynamic social networks communicate and cooperate to solve problems, that really spark the imagination.  Sarah Perez indicates that the technology:

[has been] used to develop a system for FAQ generation within a network - they call this technology “FAQtory”. With this technology implemented on a social network, FAQs are continuously generated and revised by the community using a Wikipedia-like model, as opposed to being static creations made by the site’s authors. [But it's no ordinary user-generated FAQ system] - instead, iLink’s FAQtory technology allows for incremental bits of information [to be added] - even those that don’t qualify as answers to the question. As the members contribute these bits of information, the learning system in iLink monitors how users are [attempting] to resolve queries and is then capable of drafting off the social network’s learning.

Potential commercial benefits and applications of such learning technology abound in business. Like expertise identification, comprehensive client information aggregation and delivery, FAQ generation and smart RSS filtering.  As members of, and information in, social networks increase exponentially, there is a growing need to move away from search and retrieval models of information and expertise location.  This is where smarter social technologies will help to streamline the process of recommending, and delivering, information and expertise (as well as filling-in information gaps as they go) to help people get their jobs done more effectively and efficiently.

Innovative Lawyers

The Financial Times collates and commends a variety law firm ‘innovations’ in its latest annual report on “Innovative Lawyers”.  But ‘innovation’ is now being used so loosely and frequently that it seems any old initiative is tagged as ‘innovative’.  So what is ‘innovation’ and how do firms generate it?

Peter Drucker succinctly described ‘innovation’ as “change that creates a new dimension of performance”.  Such change can occur on a spectrum of incremental -> radical innovation.  The former tends to be less costly, risky and dramatic, and the latter shifts us to a whole new paradigm in the way things are done or the products/services that are offered.  In each case, “innovation” drives businesses forward into producing new products and services, new markets, new ways of doing things, and, in particular, new ways of making money.

But the ‘change to something new’ isn’t just about coming up with good ideas, or technology pushing innovation.  John Soat records Ram Charan’s thoughts on innovation, which are right on point here:

“1. [It is a myth that a]nybody who comes up with a good idea — [is innovative]
2. [T]echnology for technology’s sake doesn’t work.  It must intersect with the consumer to fulfill a need or demand.“

Charan’s other tips for transforming business (reported by Mitch Wagner) include:

• Participating in true innovative growth projects for business, which means a change to the cost-cutting mentality to a mindset that goes after revenue growth

• Enhancing the brand

• Increasing customer consumption of the company’s product not just market share.

Those points echo the position expressed by DeMarco & Lister (1987) in Peopleware 20 years ago:

“Organisations that build products [or services] with the most value to their customers win.  Those that build products [or services] that make the world yawn lose, even though they build them very, very efficiently.  Even those who stumble while building products [or services] of high value win over the efficient yawners.”

Those views pitch ‘innovation’ as a social activity, which requires the development of appropriate competencies and resources for creativity, to encourage learning, growth and delivery of high value products/services.

The FT report, however, commends numerous out-sourcing, off-shoring and cost-cutting initiatives in the sections about ‘Thought Leadership’ (!), ‘Client Service’ and ‘In-house Lawyer’.  Apart from the obvious drivers in the current economic climate to tighten budget-belts, those initiatives focus only on the efficient performance (or production) of commoditised processes (or products/services).  Whilst demystifying, simplifying, or simply outsourcing, legal processes can help in reducing the cost of delivering legal products/services, those activities don’t assist in building/renewing capabilities overtime via an environment of learning and creativity.

Consequently, the types of knowledge-creating and diffusion activities leading to innovation capabilities I was looking for in the FT report involved experimenting, importing knowledge, problem solving and implementing and integrating (Leonard-Barton Model of Technology Capability (1992)).  Which is why I chose the following examples from the report (of Client Services, Marketing and Technology/Knowhow) to illustrate elements of the foregoing activities, as well as the approaches to innovation advocated by Charan and DeMarco/Lister.

In particular, the examples emphasise the importance of relationships/social networking, autonomy, knowledge sharing and information personalisation. They provide some insight into how firms are trying to get closer to their clients so as to provide them with the highest value products and services, as well as development of robust knowledge-bases.  And whilst the initiatives may be common or obvious to companies in other sectors, they are creating new dimensions of performance within the legal sector.  As such, there seems to be tremendous potential for firms who are capable (and willing) to experiment and import knowledge from a variety of sources and industry sectors.

Client Services (”Pleasing Results”)
Clifford Chance introduced what is essentially a social networking programme connecting its more junior lawyers with their peers in Citigroup.  A structured programme of events has been designed “to give its more junior lawyers a broader understanding of Citi’s core product areas, strategic objectives and, most importantly, the client’s concerns”.  The hope is that the scheme will develop long-lasting connections with Citi by cementing peer-level contacts and “even [form] a basis for succession planning in managing the Citi relationship”.  The approach was welcomed as “a common-sense move and a first-of-its-kind among [Citi's] law firms”.

Comment:  There are signs here of organisational learning about ‘control’ and power of networks (i.e. client relationship building no longer ring-fenced to partners).  Given that this initiative involves junior lawyers and their peers (i.e. Gen Y), I wonder if it is also, or will be, supported by online social networking, which enables people to ‘friend’ and ‘follow’ others, create communities of interest, post photos, events and status updates, and generally connect in ways they have become accustomed to on the internet?

Marketing (”Sweetening the Deal”)
Malcolm Cannon, chief executive of Hunter Boot, the boot maker, indicated in the report that he is bombarded with information from other firms. “KnowlEDGE is extremely simple to use and lets you tailor it.  …  Maclay Murray & Spens is so different from other law firms in simplifying things and giving a much more human touch. The branding is strong and consistent and the marketing is reassuring, so you feel you are buying into something that is special to them and so is special to you.”

Comment: This is a great example of the enormous strategic value of technology, which coincides well with Charan’s point about technology intersecting with the consumer to fulfill a consumer need or demand”.  It also illustrates innovation in the form of law firm ‘brand enhancement’.

Technology/Knowhow (”Use IT or lose it”)
Cleary Gottlieb features for “knowledge engineering techniques to capture the expertise of senior staff, embed it in a computer system and pass it on to junior lawyers online.”  The report goes on to state that “this collective experience is distributed on the firm’s intranet as knowledge maps - graphic presentations of how to perform key transactional processes, with each stage backed up by extensive documentation … [described] as intelligent online textbooks”.

Latham & Watkins was also highly commended for its creation of “structured” wikis or “twikis”, which enable the firm’s lawyers to create their own applications without involving the firm’s software developers.

Comment: The knowledge capture and codification idea in the Cleary Gottlieb imports technology/knowhow form the military arena.  However, it does leave me wondering about how:

• information flows through the knowledge maps (and documentation) to keep them current,
• they are linked to expertise, networks and new projects, and
• people interact with them - tagging what’s relevant, leaving comments or asking questions about ambiguities?

Unfortunately, there was no further detail on the types of mash-ups at Latham & Watkins.  I’m speculating here, but the innovation could provide the firm’s lawyers with personalised dashboard (Netvibes style), promotes the usability and efficiency of the wiki.  Mash-ups are a key tool in user adoption of the technology, allowing each user to easily select and organise his/her information flows, social networks, activity streams, and tools depending on individual preferences and work needs.  They can also push to the fore important content, specific to the person, based on that person’s activity and preferences.

In light of the examples of innovation (and technology cross-over) outline above, I’d like to finish with a thought from Bruce MacEwen (Adam Smith Esq. - 13 June 2008) about the role of technology in innovation, empowering people and binding a firm together.  After relaying almost-forgotten aspects of the personal computer revolution in the 1980s, and the enormous strategic value of the shift, he suggests that:

“[T]oday the goal is … to embrace the range of Web 2.0 technologies–social networking software in general, which enables people to collaborate at a distance.  Because, after all, what do lawyers do?  They collaborate.  And in today’s economy, they are almost surely collaborating “at a distance”–in space or in time or both.”

AM Law Tech 2008: IT in the balance

The 13th annual technology survey of AM Law 200 firms makes for a disappointing read from a social software/organisational change perspective.  The report suggests that firms are grappling with issues like “what emerging technologies are worth investing in - and which aren’t ready for prime time”.  However, in respect of ‘collaborative’ technologies respondees were asked only whether their firms use web conference software, blogs or wikis.  What!  No mention of RSS, feed readers or aggregators, let alone micro-blogging, friendfeeds, personalised pages, social tagging or content filtering.

The report blandly states that:

“While some firms have dipped their toes in the water — 43 percent run one or more blogs; 24 percent use intranet wikis (Web pages that let users contribute or modify content) — it’s been fairly ho-hum stuff by Internet standards. Blogs with lawyer posts on happenings in a practice area and wikis to collaborate on interoffice documents are the norm. It’s still unclear what sort of future these technologies have in a law office. But seemingly everyone is thinking about it.”

Of course firms are thinking about it!  Else they will find themselves sitting on the wrong end of the technology commoditisation process which turns yesterday’s shiny innovation (*email*) into today’s ubiquitous baseline or even legacy tool.  Not only do such tools offer no competitive advantage, they also trigger negative consequences, like information overload and silos of out-of-date content.

And the examples in the report of how blogs, wikis and social networking tools are being used in firms certainly are ‘ho-hum’.  From adoption and knowledge sharing perspectives, the Allen & Overy use of group blogs (integrated into wiki spaces) for knowledge networking is far more instructive.  As for wikis, they can be used to capture ideas, questions and comments in respect of groups or projects, and then to aggregate all interactions with content, so as to highlight recent activities, popular and/or salient items (from an individual or group perspective).  All these collaboration activities are quite distinctive, yet supplementary to, document management activities supported by other systems, as these articles illustrate:

• DMS and collaboration suite: friends not foes
• Wikis in law firms
• What to do with Sharepoint wikis

Those are just a few examples of how firms are endeavouring to adapt and apply new techologies to help people work in smarter more social ways.  And there are even greater opportunities for the ‘re-engineering’ of knowledge intensive processes in business through technology.  As Simon Wardley has emphasised, unlike previous generations of technology, which essentially offered the opportunity of ‘substitution innovation’ (doing what had always been done a little better), new technologies like RSS, micro-blogging, social tagging and networking tools, offer possibilities for radical change in the way in which things are done.

These are some changes we are seeing or expect to see very shortly through the use of integrated platforms incorporating a range of social tools:

• Reducing information retrieval costs by encouraging users to employ monitoring and delivery modes of information retrieval rather than searching for information or navigating to static destinations (like external sites).  The former modes rely on RSS feeds delivered to feed readers, blackberries or mail accounts.
• Helping people to get out of their inboxes by offering alternatives to email.
• Using micro-blogging to spark quick reaction to breaking news, increase awareness of on-going work and to strengthen social ties across the firm
• Eradicating the static expertise directory and instead pulling information from the user’s activities, including blog posts, comments, tags, feeds and favourites into a dynamic ‘public’ profile which provides a rich picture of the user’s status, work, professional network, expertise and interests.
• Providing personal dashboards to allow people to design and control his/her interactions and information flows to best suit their changing needs.  That means allowing people to easily add, organise and view activities, discussions, news, feeds, communities, colleagues, etc,
• Delivering more targeted relevant information by recommending and filtering information based on the individual’s tags, subscriptions, or activity with content, communities, projects or individuals.

All examples of how firms need to continuously adapt just to stand still.

Tagging the tweets

Over the last few weeks there’s been some interesting exchanges around mandating the use of social tools (in particular blogs) within an organisation as ‘reflective’ tools for sharing and learning (see Abraham, Leberecht, Leyden and Cornelius). Those exchanges dovetail nicely with another weighty debate around tailoring the functionality of tools like ‘Facebook’ and ‘Twitter’ to suit the enterprise context, and more particularly, whether their use should be given a top-down or other informal nudge to ensure contributions are sufficiently work-related. The former is now moving through a spectrum of mandating -> encouraging contributions and the latter is focusing on channeling or containing them.

Moving away from a ‘they just must‘ perspective, we can instead observe how people are communicating and with whom, and why in other instances they are not. We also have the opportunity to consider how to channel ‘twittering’ behaviour to help us work in a more fun, informed and effective way.

The working paper “Communication (and Coordination?) in a Modern, Complex Organisation” by Adam M Kleinbaum, Toby E Stuart and Michael L Tushman (Harvard Business School, First Look, 29 July 2008 ) provides some extraordinary insight into the structure of communications in a modern organization. In other words, who is communicating, how often and with whom? To answer the following question, the study analysed millions of electronic mail messages, calendar meetings and teleconferences for thousands of employees in a geographically dispersed, multiunit enterprise:

What is the role of observable … boundaries (i.e. business unit, office location, gender and tenure in the firm) between individuals in structuring communications inside the firm?

The salient findings include:

• The extraordinarily high similarity and parallel relationship between email and face-to-face/social networks within the firm.

• The striking relationship between e-mail activity and hierarchical level; the average executive (members of the top four salary bands) in the sample sent and received more than twice as many e-mails as the average middle manager who, in turn, sent and received more than twice as many as the average rank-and-file employee.

• That women, mid- to high- level executives, and members of the executive management, sales and marketing functions are most likely to cross the company’s social structure gaps and participate in cross-group communications.

What we don’t know is whether (and if so the extent to which) other communication/collaboration technologies were available within the firm. Of course the authors warn against generalisations based on results from a single organisation, but given well-known issues associated with email overuse, abstinence from traditional ‘above-the-flow‘ KM/collaboration, and the need for buy-in from management, I think the study supports some principles which can guide behaviour in other instances.

If social tools are thrown into the mix, any adoption strategy should look to the participation of the groups identified above, who are key information/social networking nodes and would be invaluable to any social software pilot. But engaging the high-level executives (in particular) could be a very large mountain to climb. Whilst that group has a considerable amount to gain from ‘above-the-flow’ activities and slight changes to behaviour (like micro-blogging instead of emailing), they usually have well established preferences for face-to-face, email or phone communications, and need to cope with a variety of political/power dynamics. And as for a “they just must” approach with this group: forget it!

Simply articulating the value to be obtained from experience will clearly not be enough, even if people are being given the time to take up the opportunity. Instead, barriers to the participation, reflection and learning processes need to be lowered. Amongst other ways, that can be achieved by giving people the means to capture their thoughts on a platform in a more informal conversational way - whilst they are working (i.e. more ‘in-the-flow’ of daily operations). Whether that be through micro-blogging, sticky notes or commenting, status updates or wall-postings, the process should reflect people’s preferences for technology and communication style. As we are seeing, that means enabling ‘twitter-ing’ quick-fire style exchanges during people’s work, which can be rapidly embellished and/or responded to by others.

And rather than defining the scope of the tools (like “please use this for client and not social purposes”), use tags, aggregators and RSS to manage/channel the flow of content. Having started the debate, McAfee on further reflection notes “… norms and policies might not be the only ways to make a tool like Twitter work well for enterprise purposes”. The idea is to “tag” the tweet, perhaps by prefacing it with characters (like @FM) corresponding to a client or contract. In that way, it would be possible to categorize and organise the flow of information.

In fact, that may be one use case for PagesPlus (which Paolo Valdemarin from Evectors very kindly demostrated to everybody at Headshift yesterday morning!). Since the core of PagesPlus is an aggregator, it can digest any form of RSS/Atom and use tags to organize everything it aggregates. Because the aggregator supports tag schemas not only can it distinguish between a topic-tag and a category-tag, but it also allows you to create your own schemas to address specific needs. With the WYSIWYG application allowing users to easily create content at the front end, it would be a small step to continually auto-save the content and for the system to recommend to the user tags based on an analysis of the text being typed (and other tags applied in the past). That content could be pushed out to the categories and pages corresponding to the tags, and to the users who are subscribing to feeds from those categories.

Essentially, designing the tools around people’s preferred styles of communication and collaboration will help to support behaviour rather than control or mandate it - a poor counterpart. People may then filter content and functionality depending on their style and preferences, and then hook other people and content into the process by creating actions and feeds out of their activity. All up, that approach should help to get people on board and keep them there.

In the same way the famously contrasting perceptions of the nature of organizational communities has animated a great debate in organization theory during the past few decades, so too perhaps will the issues discussed here continue to test knowledge workers. Kleinbaum et al cite the study of Hannan and Freeman (1977), which posed the classic question, why are there so many organizational forms, and DiMaggio and Powell’s (1983) rejoinder, why are there are so few. Likewise, I wonder about the levels of diversity of communication and collaboration actually being facilitated in organisations, and why there aren’t more.

Wiki markets

Another addition to the open-source participation economy is the contest for the creation of new futures contracts. It is being staged on MarketsWiki - an online open source knowledge base for current and historical information about the global exchange traded capital, derivatives, environmental and related OTC markets, with idea and opinion contributions being encouraged from investors and traders alike.

The ‘Great Contract Challenge‘ provides another illustration of the prospective benefits of crowd sourcing. In other words, tapping the ‘wisdom of the crowds’ offers greater innovation potential than traditional approaches which have viewed and relied on exchanges as the source of new/novel financial instrument creation. Prospective customers’ involvement in the design and selection of those instruments which appear most promising, should also constitute a form of natural selection and help ensure only the fittest new products make it to market.

Aside from the shift in mental models, the contest also underlines the departure from traditional approaches to control - of information and processes - and a move towards participation, transparency and democratised decision-making. Admittedly, the contest is being staged in the public domain, where such ideas have already found fertile ground, and social networking and idea-sharing sites, and technologies in support thereof, are now relatively commonplace. Nevertheless, there’s also increasing evidence of this type of change occurring in many professional service organisations, not least of which being their growth in the adoption and adaptation of social tools tailored to suit their business purposes.

Even if those organisations don’t subscribe to an ‘innovate or die’ approach apparent in the derivatives sector, they still need to pay careful attention to the strong steady changes fostering teamwork, dialogue and learning, being nutured by their more adventurous competitors. To that end, we’re now seeing ever increasing interest in the customisation and use of tools such as wikis, blogs, social bookmarking, tagging and RSS to help better connect knowledge workers with current relevant information and expertise to extract value from complexity and commoditisation alike. Those same tools which support MarketsWiki and other collaboration environments.

As noted by Bruce MacEwan in his recent blog about law firms, billing hours and complexity:

“There will always be both ['expert' and 'commoditized service]. That said, I think what constitutes either will evolve. Some of what is viewed as expert now - will devolve into commodity. New areas (unseen before - maybe new types of financings to emerge from the current crisis) may be the new “expert” (i.e., the always-sought-after high value engagements) areas.

To lubricate this information -> knowledge transformation cycle, and for firms extract value from it, they need to make it far easier for their staff to generate, find, share and use information and expertise. One straightforward way to do this is through systems which flex, shape and emerge depending on what people are trying to do. Systems which not only give people a better platform on which to work, but which can also make use of the trails people create as they search, bookmark, rate or view things - all very simply stuff focusing on supporting and gathering intelligence from people’s interaction with the system. And when these individual activities are aggregated, they provide powerful indicators of what is most useful or important to people across the breadth of the organisation. Another example of crowd sourcing - but this time applied internally - to tap the wealth of (informal) sharing which often occurs in casual exchanges, via email or other channels, and can so easily be lost in organisations which fail to innovate, or at least improve, their current information and technology environments.

Complexity theory: lessons from the Savannah

From time to time it’s instructive (and fun) to explore other systems and theories, as a way of learning and coping with problems in our projects, company or wider business environment. Take, for instance complexity theory and life in the Kruger National Park.

Broadly speaking, complexity theory suggests there is an underlying natural order to the behaviour and evolution of complex systems - be they ecosystems, financial systems, business operations or herds of buffalo. The following clip illustrates how herds and prides comprise sub-systems in the greater (Savannah) system. Each buffalo (or lion) operating with its fellow herd (or pride) member to form a unit, seeking to achieve a common goal, without anyone of them managing the operation! Each unit in the clip responded to the action of the other (and a third party intervention - in this case that of the crocodiles) - and together effected a pattern of self-organising behaviour, where the group was responsible for dividing and attacking the target. Something that each individual could not have achieved alone.

In other words, the disparate elements worked together in a self-directed manner to achieve coherence in the overall outcome. With each actor having some freedom to attack or kick from a certain angle or at a given target, allowing them to spontaneously adapt to the situation - all elements of ’survival learning’.

So what are the implications for our work with people, information and technology?

Many organisations, in particular legal and professional services firms, are eternally challenged with ‘managing’ knowledge (and associated spin-offs for innovation). Until recently, they have been trying to do this through standardised inflexible top-down controlled systems, which require ‘knowledge’ to be distilled, refined and polished (all as separate time consuming activities to people’s daily work load), and then ‘filed’ in pre-determined siloed categories with associated taxonomies. Not much room in there for self-directed action!

That has led some to implement more flexible solutions and processes - including the use of social tools. Complexity theory suggests that, given enough latitude, people will self-organise and bring about their own natural order by using tools such as wikis, blogs, tagging, etc, to suit their information and process needs. (Social tools having the innate flexibility to support that type of behaviour.) That has direct implications, amongst other things, in respect of any top-down structuring of content, and managerial support and direction in the use of the tools.

It follows that people should be allowed and encouraged to use the tools to create their own view of the information, by tagging, linking and bookmarking content which is useful to them - i.e. bottom-up activity. Not only will that help the individual later find and use the content, but when each individual’s activity in the wiki is aggregated with that of others, it creates a collective intelligence and signals about the information people find most useful and the way they are categorising/labeling it to promote its future findability (because people use terms and content which are relevant and useful - rather than ‘miscellaneous’). As people use the tools, and reflect on and update the information/knowledge therein, they learn how to adapt their behaviour and what works best in their circumstances.

In other words, this behaviour is self-directed and emergent because it is dependent on the current issues and opportunities people have to deal with. Those issues and opportunities in turn impact on the value of yesterday’s information, which usually needs constant attention and updating to ensure it is current and relevant, so as to be able to help in solving today’s problems. So, as people query, discuss, update and re-categorise information, they leave crucial footprints and create new information - all of which can be captured (as part of the participation process) within the social tools, and collated to form new information which is fed into the stream of current awareness people use to make decisions about the issues they face. As such, trying to plan for and create wholly top-down structures (like categories and taxonomies) for information, and responsibilities for its capture and upkeep, is somewhat futile. That approach cannot reflect real-time changes and learning derived from people’s experience with the system.

And the take-away point here is: Allow people to self-organise in their use of social tools, and the creation, updating and maintenance of information/knowledge therein.

As I outlined in my last post, that will require businesses to take a different tact regarding control - i.e. stepping back and letting people develop their own patterns rather than trying to predict and standardise the structure of information and its use from the outset.

But that doesn’t necessarily mean a wholesale departure from top-down categorisation since the system may, to a certain extent, still depend on the interactions with certain pre-defined/categorised elements. Nor does it mean that the use of social tools, and the management of information therein, should be devoid of strategic planning for their development, enhancement and future growth. Planned emergence can play a key role here in helping to ensure we develop our ideas, knowledge and expertise, and systems in support thereof, in a way that helps us best deal with our everyday problems and ambuguities. As the lions demonstrated, it’s just not enough to catch your prey, you’ve got to be able to follow through in uncertain rapidy changing circumstances.

“We Think…”

Last week, I went along to the RSA to listen to Charles Leadbeater talk about his book “We Think”, research and thoughts on the web and the web’s effect on mass creativity, innovation and collaboration.  He indicated how the web has created new vantage points on old questions (e.g. effect of technology on societal change and the scale of such change) and new dichotomies (e.g. sharing vs making money, and autonomy vs authority, where online collaborations create new hierarchies and different forms of ‘control’).  This provided the context for the central themes of his book, namely

• Ethic of Participation:* Prior behaviour characterised by ‘work during the day’ and ‘consuming or engaging in social pursuits by night’ is becoming more complex, and being blurred by people (who are ‘amateurs’) creating things in their leisure time (traditional ‘consumption’ time) to a very high standard, and using those outputs during work time (e.g. open source s/w).
• New ways to collaborate:* Involving hierarchies, but of a different kind to those which we are accustomed, being more meritocratic, transparent and fluid.  That is leading to new forms of organisation, which allow us to imagine how we can get stuff done together, as well as giving us new perspectives on control and value chains - now being more like hives or nests.
• New motivations: Which asks us to look at why people are contributing to the content and community of the web.  Some motivations revolve around recognition.  The implication being, that if businesses/organisations don’t get it, they are not going to be creating environments where people will contribute (creatively and innovatively), nor will the businesses/organisations themselves be contributing (or able to do so).
• Ethic of Sharing:* How wealth in the broadest sense gets generated in an economy of ideas.  He suggested that the above three themes invite us to think about wealth creation in entirely new ways, and to depart from traditional models of closed investment/ownership/private property (historically) being the necessary ingredient for the development/exploitation of primary goods, labour, ideas and innovation.

These themes in turn raise considerations about freedom and its relationship with creativity - where one is perhaps derived from experiencing the other and forms part of the new ‘motivation’.  It also raises the question about how deep the participation culture will go when, for example, ideas are circulated and one organisation alone profits from their exploitation.  In other words, where people are choosing to do things in different ways, and are participating in new modes of on- and off- line collaboration (made possible by the web and the variety of technology available to users), what type of sharing models are available in a world based on wealth, and how do we innovate the business models themselves (not only the products and processes)?

In one area, new models have been facilitating the flow of resources and action to issues that need addressing even where there is no (or little) money to be made.  Take Kiva for example.  Kivais the world’s first person-to-person micro-lending website, empowering individuals to lend directly to unique entrepreneurs in the developing world.  Guy Kawasaki explains that Kiva’s model involves a minimum $2.50 voluntary fee that lenders pay when checking out their “shopping cart.”  Consequently, lenders receive no interest and pay a voluntary fee to Kiva in order to loan money.  Great business model!  Relying as it does on people’s motivation to share and participate in the building of an online community (and to pay to do so).  Here, innovation in technology (web) and the business model itself has facilitated pockets of local action, which collectively, are having a tremendous global effect.  This type of thinking and action is also behind many climate change initiatives, not least of which being Do The Green Thing.

In other areas, the discussion surrounds the organisation, and its generation and exploitation of ideas and knowledge.  Chesbrough explores these ideas in his recent book “Open Innovation: The New Imperative for Creating and Profiting from Technology“.  He discusses the departure from prior models which relied on creativity within the firm, to the need for innovation in the business model itself (i.e. models of ‘open innovation’) which enable firms to tap ideas of customers and users and involve customers as co-producers.  It also requires ideas to flow - into and out of the business - requiring a different approach to control and the creation of value.

Proctor and Gamble is perhaps one of the more famous examples of open innovation, actively seeking user-community participation in developing new product ideas.  Another interesting ‘environmental’ example, promoted by the World Business Council for Sustainable Development (WBCSD) and IBM, is the “Eco-Patent Commons”.  That initiative makes available patents to “encourage researchers, entrepreneurs and companies of all sizes in any industry to create, apply and further develop their consumer or industrial products, processes and services in a way that will help to protect and respect the environment”.  Then, there’s Free Beer (thanks for the reference Eliot!).  It’s ‘free’ in the sense of “freedom”, not beer give-aways.  The organisation is using Creative Commons licences to give public access to the recipe and brand (for pleasure or profit).  Usual terms apply: “If you make money selling their unique beer, you have to give them credit and publish any changes you make to the recipe under a similar license”.  All the writing about ‘wisdom of the crowds’ suggests that the Free Beer recipe could be the best one yet!

Coming back to the themes above, about motivations, sharing and profiting from ideas, Leadbeater is suggesting that it’s unlikely that people will be satisfied with being anonymous contributors to a company’s ideas - they want a certain level of autonomy/freedom to create and to be appropriately recognised for their contribution.  And this is where many organisations are still getting it wrong by not understanding what is motivating people to participate, collaborate and share their thoughts.  As illustrated in the above examples, for this to happen, companies have to give away control to allow ideas and creativity to flow (and perhaps control over a range of their IP) which is probably counter-intuitive for many organisations.

What collaboration technology do you (think you) need?

There are a number of ways in which new collaboration technology may be introduced into an organisation, including:

1. An ‘inside-out’ approach which focuses first on the business needs and capabilities to be developed, then on identifying the technologies which can support those needs/capabilities (McAfee approach - “Mastering the Three Worlds of Information Technology” Harvard Business Review (2006)).
2. Continuous scanning for innovations/new technology and matching promising innovations with relevant problems (Rogers’ approach - Diffusion of Innovations (1995) Free Press, New York).
3. Operating a ‘me-too’ approach as a result of ambiguous goals and a volatile/uncertain environment, whereby the implementation of new technology is influenced by/modelled on what other organisations are implementing or the current technology adoption trends in the market (Mimetic Isomorphic approach - DiMaggio and Powell The Iron Cage Revisited American Sociological Review (1983)).

In an effort to determine which approach businesses favour and the consequence of the approach in terms of wiki adoption, I asked survey respondents to identify the drivers behind their wiki implementations and how they are actually using their wikis, to gauge if there was a correlation between the two. The key business ‘needs’ identified spanned three broad areas of supporting collaborative work practices (27.88% of responses), increasing the effectiveness/efficiency of existing tools (22.68%), and improing the ability to locate or retain information/knowledge (23.05%). Few responses indicated (or admitted?) that the wiki had been implemented simply because it represents something of a new trend in collaboration technology.

In terms of what the wiki is actually being used for in the workplace, responses indicated their primary use as knowledge bases (22.53%), for ideas generation (16.21%) and project collaboration (16.21%). With the primary need being to support collaborative work practices, higher actual uses for ideas sharing and project collaboration might have been expected instead of the wiki’s predominant use as a knowledge base. Of course, it could be inferred that the primary need is being satisfied through a variety of wiki uses, of which the knowledge base currently predominates, with actual uses for ideas sharing and project collaboration increasing as people discover other uses the for the wiki.

What’s intersting about this however, is that wikis are being employed mainly for internal purposes, and not for marketing and collaboration with clients (a mere 3.85% of responses indicating use for this purpose). On the one hand, given the relative newness of many wikis (remember that 47% of the 102 wiki implementations survey were under a year old) the responses may suggest that wikis and capabilities regarding their use/management are still being developed internally before being extended outside the organisation. Alternatively, given the importance of collaborations with customers, it may suggest that businesses are not in fact applying the wiki to key needs, which requires the development of capabilities so as to be better able to deliver what it is the customer wants. Integral to that is the ability communicate quickly and effectively with customers.

During the interviews I conducted, I asked Suw Charman what ‘needs’ were driving the implementations (e.g. inefficiency/ineffectiveness of existing tools, inability to locate/retain information and/or knowledge, better support for collaborative work practices, etc). She noted that “there is a difference between what businesses need and what they think they need”. She went on to indicate that due to their popular public uses (e.g. Wikipedia) businesses implement wikis to help employees find and access past/current information, instead of thinking about issues surrounding efficient work, and better collaborative, practices. Consequently, “they tend to look at the problem the wrong way around … since it is not about sharing knowledge and the introduction of a new technology per se, but about getting work done quickly and easily”. Her comments reflect the practicalities of the Rogers’ approach and the imitative selection processes that create a form of ‘pressure’ as a result of the Mimetic Isomorphic approach, which approaches may not in fact focus on the collaborative behaviours/capabilities which need to be developed and engender requisite/appropriate managerial support to do so.

In light of the reported barriers to wikis’ use (e.g. time to contribute/maintain content, reliance on email, lack of managerial support, culture, lack of clear purpose for the wiki and wiki not being integrated with other tools) it seems that reliance on the Rogers’ approach or the Mimetic Isomorphism approach is resulting in a lack of commitment to the change process integral to the adoption of this style of collaborative technology, undue reliance on voluntary adoption and insufficient support during the adoption process, and loss of opportunity to recognise why such tools like wikis are being introduced to the business and their potential to help resolve issues with existing knowledge management/work practices and develop collaborative capabilities both internally and externally. In other words, a more holistic ‘inside-out’ approach.

New technology - Old Problems?

Increasingly, wikis are being implemented in businesses to address concerns with knowledge management, collaboration practices and limitations of existing systems, and to:

• Reduce email traffic;
• Provide a common platform (rather than a private channel) for collecting, organising and sharing knowledge and experience of all stakeholders;
• Provide a flexible tool adaptable to a range of uses including knowledge repository, project/action tracking and intranet;
• Facilitate swifter more widespread and effective communication.

However, their use in the workplace maybe inhibited for a variety of reasons including:

• Potential lack of clear purpose since wikis may not replace existing systems or processes;
• Lack of content or too much unmanageable content if not refactored (i.e. editing/organising pages);
• Bureaucratic command-and-control organizational (sub-) culture(s) and structure which stifle knowledge sharing, openness and trust;
• Risk of abandonment if users do not perceive a clear need for, or benefit from using, wikis or other barriers to their use are not overcome.

Those difficulties raise specific issues about wikis’ management and use, the effect of organisational context (i.e. structure and culture) on wiki uptake, and more generic issues about adoption of innovations. Similarly, a business’s ability to collaborate effectively reflects issues at the heart of technology management, namely improving the effectiveness of an organisation and its people through the application of concepts and techniques for operating, improving and integrating an organisation’s systems, and introducing innovatory systems.