A CEO’s view of KM – the organisation as a knowledge factory

It’s always insightful to read a CEO’s view of KM. Here’s one that might surprise you.

One of the more interesting essays on Knowledge Management in the mid 1990s was written by John Browne (now Lord Browne of Madingley),  who at the time was the Chief Executive of BP.

It is interesting because it gives a CEO’s view of KM, which is a view we don’t often see.

In the quote below, we read not just what this CEO saw as the value of KM and Organisational learning, but also how the importance of Knowledge changed how he saw the organisation itself.

“Learning is at the heart of a company’s ability to adapt to a rapidly changing environment. It is the key to being able both to identify opportunities that others might not see and to exploit those opportunities rapidly and fully. This means that in order to generate extraordinary value for shareholders, a company has to learn better than its competitors and apply that knowledge throughout its businesses faster and more widely than they do. The way we see it, anyone in the organization who is not directly accountable for making a profit should be involved in creating and distributing knowledge that the company can use to make a profit”

Let me stress that last sentence again

“anyone in the organization who is not directly accountable for making a profit should be involved in creating and distributing knowledge that the company can use to make a profit”

That is a remarkable view of an organisation as a profit-focused knowledge factory, creating and distributing knowledge for the benefit of the front-line knowledge workers.

The same “knowledge factory” image came to me recently, working with a public sector educational organisation, who’s whole raison d’etre was to create knowledge. Here we took a new process-focused view of the organisation, and started to identify the knowledge and information inputs and outputs for each step in the value chain. It was really illuminating.

If you think of your organisation as a profit-focused knowledge factory, then you can start to think about applying manufacturing thinking to the flow of knowledge – thinking such as debottlenecking the knowledge flow, or lean approaches to knowledge supply. You can start to ask, who is in charge of production? What is the knowledge supply chain? Can you use Japanese style processes such as Kaizen and quality circles to improve the flow?

Take a look at how well your organisation operates as a knowledge factory, and ask – just how well do we process knowledge? Does everyone who is not making a profit or delivering a service, actually realise that their job is knowledge production?