ONE POINT OF VIEW
Knowledge management is the most innovative, creative, and important management concept to come along in the last 25 years. It doesn't imply downsizing, restructuring, getting rid of people, reorganizing, or doing all of those traumatic things that have characterized so much of corporate behavior in the last quarter century. Rather, knowledge management reflects a point made by Lew Platt, former CEO of Hewlett-Packard: "If HP knew what HP knows, we would be three times as profitable."
That one idea leads to understanding the role of tools, techniques, motivation, attitudes and, incidentally, of technological aids. People inside the firm and the others associated with it as a system-vendors, suppliers, regulators, customers, and so on-together know everything that the business needs to know. What is generally missing is a mechanism for tapping those mines of knowledge.
Knowledge management has drawn consultants and vendors out of the woodwork with their particular offerings as the solution to the problem of implementation. This rush for business is an example of Abraham Maslow's notion, "For a man with a hammer, every problem is a nail." Knowledge management is concerned with communication within an organizational system, i.e., everything that is connected with the business. There is no problem if you already communicate; it's the people you don't normally communicate with who are the focus of knowledge management.
Knowledge management reflects the high value of intellectual property, whether or not it is in patents or protected by other legal instruments. Intellectual property is increasingly regarded by economists and business people as a most important asset right up there with land, labor and capital. Knowledge provides the competitive edge. As an asset, intellectual property should neither be ignored nor wasted. It should be nurtured, cultivated and harvested.
Knowledge management may carry a firm to an unexpected new stage of value. I divide the stuff that we generally call data, information and so on, into four stages. The lowest stage is data. Above that is data that are interpreted and become information. When that information is generalized it becomes knowledge. The data stage is in great shape, and the information stage is reasonably healthy. We are witnessing the evolution of tools and techniques to develop knowledge. But beyond knowledge is a fourth stage, wisdom, and as far as I know, there is nothing going on in the corporation to create wisdom.
Wisdom is the answer to the question "why?" The other stages answer "how," or "when." Knowledge management, when it's up and running, may provide insights by way of wisdom.
A Lesson from Richard Wright
Let me illustrate why R&D executives may be blocking the emergence of knowledge management. In 1945, Richard Wright published his blockbuster autobiography Black Boy. The story of Wright's youth in the South during the 1920s, it told how he escaped from that hellhole and came north to Chicago. There, in his twenties and without skills or experience, Wright found work at a leading medical research institution. His job, along with three other blacks, was to clean the floors and steps. The four of them also took care of the lab's animal room. Wright often found when he was cleaning the steps that the doctors would just splash right through the water and soil the steps he had already cleaned without a word or a sign of apology, or even a friendly comment.
One day, as was their custom, the four men retreated to the animal room and locked the door so they had their one hour of quiet while they ate lunch. The two older men got into a fight, in the course of which many cages were toppled and animals escaped. Finally, the other two warned them to stop otherwise they would all be fired. With about 30 minutes to put the room back in shape, they couldn't be certain which animals went into which cages. …