The dilemma of companies: Living today in full and being prepared for the future
”I would give my right hand to be ambidextrious” (Yogi Berra)
In (business) life things tend to move faster all the time. This remark was made already some 20 years back by C.H. Fine (1998) from The MIT Sloan School of Management. Product lifecycles even in so-called traditional industries were shortening, calling for faster product development cycles and time-to-market acceleration for innovations. The boardroom patience for results has also come down to 3 months of duration. Management lives in the rat-wheel of “quarterly capitalism”.
Practically no industry has been untouched by the phenomenon. In Finland companies such as the maritime engine and diesel power plant giant Wärtsilä have established their own venturing arms, that aim at the development form an idea to a prototype or concept in a scale of months, instead of years that the normal heavy industry R&D process takes. Some companies, like elevator-producer Kone, have created active linkages with start-up communities and companies in order to tap to their agile processes and fresh futures-oriented thing.
One could say that the moves above are outcomes of a business process management (BPM), that is the art and science of comprehensive systems to manage and transform operations of an organization” (Hammer, 2014). Hammer (ibid.) continues by stating that BPM “is arguably the first set of new ideas about organizational performance since the Industrial Revolution”. What is ignored there to a certain extent is that we do not live any more in the industrial era. We passed to the information era in 1990s and early 2000s with the advent of e-mail, automation, search engines, ERP-systems etc. As a result, many BPM efforts were seen primarily as data and software management issues.
But the context where today´s companies live is not anymore about information. According to the classical DIKIW-model by e.g. Rowley (2007) only the information (that raises out of data that we can interpret and understand) that we can use in practice – at the right time and at the right place – can be called knowledge. And we live in the era of Knowledge Economy (Powell and Snellman, 2004) where “production and services are based on knowledge-intensive activities thatcontribute to an accelerated pace of technical and scientific advance, as well as rapid obsolescence”. As can be derived from these definition, all organizations should be interested in and aiming for knowledge. Knowledge management (KM) and the rise of Chief Knowlegde Managers/Officers have been both buzzwords as well as area of substantial investments by companies in the 2000s.
So we are more knowledgeable of importance of knowledge than we have ever been. And there are more and more experts working on and for knowledge than ever before. Adding the advances in data mining, data pools and AI-powered agents, the knowledge-side of business is in better shape than it has ever been. Or is it? If not, where are the shortcomings?
The problems in current KM link largely to the idea of dynamism. Modern Knowledge Management-concept admits the stakeholder dynamism of knowledge: Knowledge is created and improved (sometimes also lost) in collaboration with resources outside the company. Zack (2011) says that one of the areas of knowing is to “know who”. This area of knowledge capital is referred to as Relationship or Structural Capital. In our recent research paper (Saukkonen & Kreus, 2021) presented in ECKM (European Conference on Knowledge Management) we underline the key finding that the other area – temporal dynamics – i.e. time-bound evolution of knowledge would deserve more attention and collaboration in companies as well as in academia.
Never before has the knowledge been as valuable as today, but neither has it been this uncertain, volatile and potentially sliding into obsolescence as quickly as today. Since all management decision are aimed at future – yesterday and largely today are non-affectable – there is an ever-growing need to assess the decisions made against the potential and interesting futures. Makes all the sense, but our bibliometric study indicates that the bridges of knowledge management and futures researchers are rare, gaining traction but slowly. We propose a model, where the company actively and in interaction with its partners evaluates the relevance of its knowledge portfolio (made of patents, experience, relationships, processes) it has but not only in comparison to the current business environment but also to the potentially upcoming environments. Plural form due to the fact that there always are more than one possible – yet all uncertain – futures to come about.
The most common notion on time-related dynamics is that companies need dynamic capabilities – areas of knowing and competence that can adapt to changing environment. If that adaptation happens as a reaction to changed conditions, the possibility for a competitive advantage has been largely lost. An ideal company possesses “temporal ambidexterity”: It is capable of short-term opportunistic action and mid-term strategic development, but both these scopes of management are supported to and compatible with the longer-term visionary view of the operating environment and the company itself. Coming back to the line with which we started this post (originally by the baseball coaching legend and the grand master of contradictory one-liner Yogi Berra): We would give our right hand for the benefit of being temporally ambidextrous, to be able to play the tunes of today and tomorrow at one go. Would you?
Juha Saukkonen D.Sc. (Econ.)
The author act as the Senior Lecturer of Management in the International Business –program at the JAMK University of Applied Sciences, focusing in teaching and research in Technology Business, Knowledge Management and Futures Foresight
REFERENCES:
Fine, C.H. (1998). Clockspeed Winning Industry Control in the Age of Temporary Advantage. Perseus Books, Reading, MA..
Hammer, M. (2015). What is business process management? In Handbook on business process management 1 (pp. 3-16). Springer, Berlin, Heidelberg.
Powell, W. W., & Snellman, K. (2004). The knowledge economy. Annu. Rev.Sociol., (30), pp. 199-220.
Rowley, J. (2007). The wisdom hierarchy: representations of the DIKW hierarchy. Journal of Information Science, 33, 2, 163-180.
Saukkonen, J. & Kreus, P. (2021). On relationship of futures research and knowledge management. In the proceedings of the 22nd European Conference on Knowledge Management ECKM2021, 1st-2nd September, 2021. Academic Conferences International Ltd. Reading, UK. pp. 666-673
Zack, M. H. (1999). Developing a knowledge strategy. California management review, 41(3), 125-145.