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Step By Step Guide

The following is a detailed step-by-step guide on how to implement such processes with refer­ence to the relevant practices.

Process 1: Formulation of Knowledge-Based (or IC) Vision

Vision formulation should be done for the whole organization. The individual business units and departments can later align their missions with the vision, depending on the size and structure of the organization. There are three main steps to the formulation of the vision. The first step is performed by the leadership where the organizational vision is first formulated. The resulting vision should then be aligned with that of the key people, or the heads of business units. The final step is commu­nicating the vision to everyone in the organization through the necessary changes in culture.

Step 1: Leadership Formulation. Vision formulation is an inward-looking exercise for the organization where it defines who it really is and who it envisions itself to be. Regardless of the words, a vision statement should contain the following components:

•   Purpose of the organization reflecting its character and identity. An organization's pur­pose is beyond providing a living for its employees, or satisfying a demand in the mar­ket. It is also beyond the delivery of a certain product or service. Equating purpose with delivery of a certain product is not only restrictive but irrelevant as well. This is because the activity of delivering a certain product represents what an organization does and will continue to do to sustain its existence. It is like any of the voluntary biological systems of the body (circulation or breathing), which though critical for the continuation of the species doesn't provide personal motivation for advancement and growth.

•   The business the organization is in by identifying the difference it wants to make in peo­ple's lives.

•   The unique value that the organization adds to its customers.

•   The role the organization wants to play in the future as it envisions it.

•   The cultural values and personal qualities and skills that its people should have.

The vision has to be inspirational and stress the role of IC or knowledge in the future of the organ­ization. There is no magical statement. Actually, the words of the vision are of secondary impor­tance; it is the exercise of formulating, then activating the vision, that has the transformative power. To formulate a vision, leadership of the organization needs to address the following questions:

•   What is the purpose of your organization ? Look beyond what you do to how you do it that distinguishes you from other players, hence your character and identity. Whether you know that purpose on founding the organization or try to extrapolate it in hindsight, it is important to define it. Personality is everything even for organizations; it is no coincidence that organizations with a strong sense of identity and character are the most successful.

•   What is your business ? Business should be defined in terms of the difference you want to make in people's lives; for example, Pfizer's business of caring.

•   What is the unique added value that you deliver or aim to deliver to your customers? This value should be independent of the products and services that you provide.

•   What is your vision of the future? Consult the vision of the founding leaders and what they were trying to achieve when they founded the business. Go beyond that vision into your present and envision the future. An existing or past vision that has substantially materialized cannot inspire the organization into the future.

•   How do you want to change or impact your world? What will success in your envisioned world look like? In defining success and the new environment, you should distinguish between success obtained through increased operational efficiency (i.e., economizing) and innovation (i.e., strategizing).

•   What are the main characteristics and values that your employees should have to enable the organization to attain its vision ? Summarize this in one word by subtracting all the terms that represent the characteristics and competencies that are generally accepted in your industry.

Step 2: Alignment with the Vision of Key People. Formulating an organizational vision is an interactive exercise where leadership and the key people of an organization go back and forth until they envision a desired future. The role of key people is to assess the competitive land­scape and assess future market trends and needs and envision a position in that future. Being more aware of the organizational knowledge resources and those of the competitors can assist leadership in defining the areas in which they choose to excel. Aligning the leadership vision with that of the key people also enables the latter to own the vision and the strategic direction, and hence be better equipped to communicate it to other levels in the organization. Meetings, brainstorming sessions, and retreats are a good idea in performing this step. However, without ownership of the vision by key people little comes from these activities other than socializing. The best way is to assign to a team the alignment of the leadership's vision with that of key people. This team should also be entrusted with communicating the vision to the rest of the organization.

To implement this step:

1.       Form a team comprising key people who represent the various functional departments and/or business units.

2.       Each representative should perform competitive assessment in their respective area in their envisioning of the future. This is an integral part that is many times ignored, mak­ing a vision out of touch with reality and the competitive environment that the organi­zation is part of. Formulating a future vision needs an understanding of self, the competition, and the customer.

3.       Assess and align the vision of the leadership with that of the key people through con­tinuous meetings until consensus is reached.

4.       Each of the key executives should later act as a champion of the new vision by commu­nicating it to senior and middle management in their respective departments and units as elaborated under Step 3.

Step 3: Communicate to All Levels. The best way to communicate a knowledge-based vision to all levels of the organization is by periodic (annual) meetings between the key people and their staff to communicate, review and update the vision. These meetings should be aimed at creating a shared vision, team building, and collaboration at all levels. They also facilitate the creation of the desired culture, and may be used for formulation of shared values aligned with the vision. In addition, the following measures should be taken to activate the vision across the whole organi­zation. Specific departments should be assigned to oversee certain components of the vision, where they align their procedures and practices accordingly as follows:

•   The marketing and public relations departments should align their advertising, promo­tions, and branding efforts with the vision components of purpose, organizational iden­tity and character, and description of business.

•   The new product (or service) development department should align its screening of new concepts and design of new products with the vision's proposition about the unique or added value to customers.

•   The business development or growth and development unit should align its planning for the future with the vision's image of the future.

•   The human resources department should align its recruitment and professional develop­ment policies with the vision's component describing the organizational values.

Process 2: Cultural Audit and Transformation

Cultural audit and transformation is the process in which the organization tries to find out the implicit values that underlie its behavioral patterns, work routines, leadership style, and decision making models. These values make the organizational culture, which may defeat any ICM or any program that is contrary to the underlying values of the program. Therefore, it is important to undergo an audit of the cultural values, which helps make these values explicit so that they can be effectively changed or maintained. An audit also reveals gaps between the values of manage­ment and those of employees, exposing blocks in the way of building the right culture. The right culture for ICM is one that encourages collaboration and knowledge sharing over control and rivalry. In particular, the following values need to be incorporated in the culture of the organiza­tion:

•   Collaboration, teamwork, and collegiality

•   Knowledge sharing and continuous learning

•   Creativity, self-initiated decision making, and risk taking

•   Acceptance of failure, experimentation, and innovation

Following are the steps required to discover the values underlying an organization's culture and to instill the required cultural values.

Step 1: Audit of Cultural Values. The goal of this step is to discover the organizational culture and gaps between the values of management and those of employees affecting the success of ICM program.

•   Undertake an individual profile analysis of leaders, senior managers, and executives to find out the underlying values that define their management style and affect the behav­ioral patterns, including turnover rates, in their departments.

•   Undertake a group values audit in the form of a questionnaire for the employees of each department to assess the need for cultural changes. In many organizations, there is a divergence among the cultures of the various departments, ranging from stress on con­trol/obedience, where following instructions and close supervision characterize how the work is done; to inspiration/innovation, where independence and collaboration are stressed. Research has shown that departments, indeed organizations as a whole, that dis­play the first set of values are poor performers with low employee morale and high turnover. Undertaking the audit on a departmental basis and checking productivity in these departments will reveal the departments where more work in instilling the right cul­tural values is needed.

Step 2: Effect Cultural Change on Executive and Departmental Levels. Once the results of the audit are available, it is important to implement a number of steps to ensure that the right cul­tural values are adopted, on both the executive and departmental levels as follows:

1. On the executive level. Hold leadership and coaching sessions for executives on a con­tinuous basis to mentor them into adopting the required set of values. Those execu­tives with the right values can act as mentors and suggest ways on how management styles should change. Leadership's values should be monitored constantly and should be taken into account in the process of recruiting new executives. An individual pro-file analysis is highly recommended before undertaking any recruitment decision, to rule out candidates whose values highly and strongly contradict those of the organi­zation. 2. On the departmental level. Hold interdepartmental meetings to brainstorm on what employees see as the desired, compared to the actual, cultural values that would facili­tate improved performance and higher morale. The desired cultural values discussed at this level should be aligned with those identified at the top management and executive level. The meetings should proceed by setting milestones on the way to incorporating the desired cultural values in daily operations and business practices. The milestones to be adopted are different depending on each department's progress in fostering the right culture. In general they include: redefining decision-making, teamwork, and project management policies to ensure that they encourage the desired values; recognizing and rewarding practices that advance the adoption of the desired values; and reporting on the progress of the various departments in creating the right culture and how this affects their performance.

Step 3: Cultural Change Across the Whole Organization. A number of changes are required to promote the right culture. At the least, the following changes should be accommodated:

•   Include knowledge sharing as one of the duties in the job design of all positions by link­ing knowledge sharing to the job in question, and most importantly by providing time for knowledge sharing and creation.

•   Include knowledge sharing and collaboration as criteria in the appraisal of employee per­formance, particularly at managerial levels. Promotion of managers should be based on rewarding those whose teams or departments display the required cultural values and are recognized as the best departments to work at.

•   Reward and recognize KM practices of individuals, groups, and organizational units in annual meetings. Though financial rewards are desirable, recognition of contribution is what motivates and drives knowledge workers.

•   Recognize and reward departments for transfer of own, and replication of others', best practices (i.e., recognizing all units involved to boost best practices replications).

•   Codify and disseminate success stories of how knowledge sharing, innovation, risk tak­ing, and collaboration helped to solve problems, address business challenges, save costs, or improve productivity.

After the first two processes are successfully implemented, the organization can move to KM.

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