Henley Forum for Organisational Learning and Knowledge Strategies

Connections and Contradictions

Making sense of the complexity of knowledge work in organizations.

Prof Jane McKenzie

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Connections and distinctions

Tim Harford @TimHarford 10h Hugh Howey: Self-publishing is the future and great for writers HT @doctorow http://dlvr.it/3Vq4Rn Expand Reply Retweet Favorite 2013 Henley Forum 2

Burden or Benefit?

Information can travel 15,000 miles in an instant. The cognitive-load paradigm holds that the most important part of the journey is the last few inches the space between a persons eyes and ears and the various regions of the brain. Brooks D. 2011
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How we come to know

Streams of experience

A model of information seeking behaviour

Uncertainty stress

Cognitive gaps

Problem dimensions

INFORMATION NEEDS

Suppress, avoid problem No information seeking

Perception of gap in state of knowledge, ability to make sense

Motivation interest Avoidance maintenance

Source quality

Source accessibility

Cognitive styles

Norms rules

Incidental information

INFORMATION SEEKING

Selected information

INFORMATION USE

Understanding, acting
Choo 2006 p 69 4

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Temporary Incompetence
Competent Incompetent

Old Context

New Context

The first phase of the project was reported by KE Sveiby (2012): Innovation and the Global Financial Crisis Systemic Consequences of Incompetence. Book chapter in Sveiby K.E., Gripenberg P., Segercrantz B., (2012): Challenging the Innovation 2013 Henley Forum Paradigm, Routledge, New York.

When has this happened previously?

http://carpatys.com/1971-ford-country-squire-overview.html

http://ofad.org/photo-of/the-moment/1971-honda-n600-hondas-first-car-in-america

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When the ground rules changed

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Through ignoring the impact of radical innovation

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Radical innovation
A radical innovation project is one with the potential to produce one or more of the following:
An entirely new set of performance features;
Improvements in known performance features of five times or greater; A significant (30 percent or greater) reduction in cost. It could be a product, process or service with either unprecedented performance features or familiar features that offer potential for significant improvements in performance or costs..

Radical innovations create such a dramatic change in products, processes, or services that they transform existing markets or industries, or create new ones.
Leigh Richard (2000): The Radical Innovation Imperative, Harvard Business Press

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Many examples of external change

The shift from state-owned to privatised provision of utilities, transport, health services etc Pagers and cellular telephones (as opposed to fixed line communications) in the telecommunications industry. The introduction of national assemblies / parliaments in Scotland, Ireland and Wales. The development of microbrewery technology. The introduction of elected police commissioners.

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Some massive upheavals are internally planned and generated

Re-organisation of the NHS

Mergers
Introduction of a new ERP system

Major restructuring and reorientation of a business focus

Many transformations are of a scale such that the implications are beyond the grasp of any one group of experts
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Where to focus ?
Ontologically challenging .
How do we recognise what is worthwhile knowledge?

Epistemologically there are unresolved tensions.

What lens should we use? Is it the individual or the collective mindset that has the most influence? Is there a common ground that allows us to grips with Knowledge, knowing AND organisational learning as a source of sustainable business advantage?
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Complexity
Complexity, to a large extent is shaped by dilemmas,conflicting goals and demands that unless managed skilllfully will cause a ripple effect in other areas, as other demands or priorities cannot or refuse to be neglected.
Professor Ulrich Steiger IMD 2007
www. imd.org/research/challenges/TC057-07.ctm

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Paying attention to differences that make a difference

Environment Behaviours Capabilities
Values & beliefs

Identity Purpose

Bateson 1972
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The overlapping ripples and waves create patterns of contradictions across the ecology
Behaviours Capabilities
Values & beliefs

Outside world
Environment Behaviours Capabilities
Values & beliefs

Identity Purpose Environment Environment Behaviours Capabilities

Values & beliefs

Individual

Identity Purpose

Identity Purpose

Group
Bateson 1979
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Organisation

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What is Paradox ?
contradictory yet interrelated elements that exist simultaneously and persist over time Smith and Lewis 2011

Many authors from different domains view paradox/dilemmas as a way to grapple with complex dynamics in human systems (Bateson 1972, Hampden
Turner 1990, Stacey 2001, Colbert 2004, McKenzie and van Winkelen 2004, Antonacopoulou and Chiva 2007,)

A journey into knowledge and the framing and reframing of knowledge

- Storey and Salaman 2009
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Who is responsible for navigating the Seas of Complexity

Knowledgeable organisations need leaders who can adapt to a rapidly changing world (and take others with them). Leaders have to assimilate quickly what is really important, communicate this to their teams. and inspire them keep delivering and adapting to change. Sarah Grimwood KM
Lead MWH
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Leadership in the knowledgeable organisation

Flatter organisations Authority more dispersed Climate of constant uncertainty and change Local responsible with diverse goals and purposes, which need to be integrated for overall performance
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Co-ordinating dynamic capabilities

(Eisenhardt 2000)

It takes many different skills and muscles to deliver balance and strength for the organisation
Each develops differently through practice and experience As individuals learn they have to take risks in trying new things It is ultimately a team sport that needs coaching Leadership is a knowledge and learning enabling role (Easterby Smith
and Prieto 2008)

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Organisational learning as a dynamic capability

Signals to and from the environment
Beliefs

Knowledge gap Meanings purposes, Problems, opportunities

Enactments

interpretation

SENSEMAKING

Decision gap Meanings purposes, Problems, opportunities

Cultural K

Premises

Tacit K

Explicit K

Knowing doing gap Routines

Rules

Knowledge from /to others

KNOWLEDGE CREATING

DECISION MAKING

New capabilities and innovations

Action by/on others

Choo 2006 p 250 20

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We create a share knowledge through language

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McKenzie and van Winkelen 2004

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From impulse to constructive response Spreading and embedding the

message (Crossan et al 1999) Recognising and working on resistance Managing friction (Seo et al 2010) Using judgement to stretch the system
(Arthur 2009)

Massaging political sensibilities (Lawrence et

al 2005)

Establishing systems and and processes that organise for dynamic stability
Schreyogg and sydow 2010

Translating tension into creative drive

(Storey and Salaman 2009, McKenzie and van Winkelen 2004)

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Through orchestrating serendipitous conversations (Mengis and Eppler 2005) 22

Wise Leaders..
Strong strand of leadership literature suggests leading is about making sense amidst paradox
(Dennison 1995. Kan and Parry 2004, Bass 2008, Rickards 2006, Weick 2009 )

Some academics beginning to focus on paradoxical thinking in relation to wisdom and sound decisions (Nonaka and Takeuchi 2011,
Tushman et al 2011, McKenzie Woolf et al 2009)

Rather than seeking an optimal balance between contradictions, they engage in dialectical thinking, which enables them to deal with contradictions, opposites, and paradoxes by moving to a higher level. Nonaka and Takeuchi 2011
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.Understand that identifying the decision context is only part of the Complex Chaotic problem Flux and unpredictability High turbulence
No clear cause-and-effect relationships, so no point in looking for right answers Unknowables Many decisions to make and no time to think High tension Pattern-based leadership

No right answers; emergent instructive patterns Unknown unknowns Many competing ideas A need for creative and innovative approaches Pattern-based leadership

Simple: Repeating patterns and consistent events Clear cause-and-effect relationships evident to everyone; right answer exists Known knowns Fact-based management 2013 Henley Forum

Complicated: Expert diagnosis required Cause-and-effect relationships discoverable but not immediately apparent to everyone; more than one right answer possible Known unknowns Fact-based management

(Snowden et al, 2007)

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. pay attention to the potential decision biases

Bias Escalation Description Commitment to a losing course of action: stems from holding to initial positive beliefs in the face of negative new information (1) Anchoring Status-quo Sunk-cost Confirmingevidence Giving disproportionate weight to the first information received (2) Preferring alternatives that preserve the status quo (2) Making choices that justify past choices (2) Seeking information that supports own point of view and avoiding information that does not (2)

Framing

The choice made about how to position the question, for example as a gain or a loss, or in relation
to particular reference points (2)

Over-confidence

Tendency of most people to be over confident in their accuracy with which they make estimates or forecasts (2)

Prudence Recallability

Tendency to be over cautious, adjusting estimates or forecasts to be on the safe side (2) Being over influenced by past dramatic events or those that have left a strong impression (2)

Preference
outsiders

for Valuing knowledge from external sources more than from internal ones (3)

Key to references: (1) (Biyalogorsky et al., 2006) (2) (Hammond et al., 2006) (3) (Menon and Pfeffer, 2003)

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.recognise their meaning making role

Far from Indeterminate zones of practice learning through experience
Abstraction of meaning

Disintegration & anarchy or massive avoidance no learning possible On the edge of chaos dealing with dilemma, paradox and contradiction Deviant practices of studio and conservatoire that deepen meaning Sense-making processes

Agreement
Increase knowledge, memorise and acquire facts Close to
An interpretive process of understanding

Certainty
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Far from

Adapted from Aram & Noble 1999

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.balance Conventional and Underprivileged thinking capacities

Uncertainty
Natural preference to impose an interpretive frame of reference on a problem

Ambiguity
Natural preference to reach single meaning using own value judgements Risk of narrow, inappropriate choices
Forestall judgement to explore more interpretations to develop more meaningful choices

Contradiction
Natural tendency to reject or ignore contradictory choices

Suspend firm framing of problem space

Creates space for

supports

Recognize, acknowledge and hold contradictory demands

Leaders capable of handling uncertainty ambiguity and change 2013 Henley Forum

Knowing how to make more embracing choices that satisfy more stakeholders in the face complex dilemmas

McKenzie Woolf et al 2009

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.co-ordinate priorities to exploit and explore

People want to be skilled and creative Take pride in solving tough problems and being able to help Set challenges Create culture of innovation SENSE MAKING

Look around, look outside Take a different perspective Ask new questions Collect new information

KNOWLEDGE CREATING

DECISION MAKING
What is to be done How to meet goals How to deliver results How to show competence

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Choo 2006 p 308

Four core paradoxes for any knowledge collective

Affects knowledge relevance

When? Learning Future Now

Human capital development

Affects Knowledge sharing and engagement

Who? Me We Belonging

How? Structure Fluidity Organising

Social capital development

Affects Knowledge stickiness, repeatability and rigidity

Structural capital development

Coherence
Financial capital development
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Diversity Performing What?

Affects knowledge differentiation

Based on Smith and Lewis 2011

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Learning
Sense making

Mindfulness

Total Leadership

Sustaining Gravitating identity & to new community regimes

Charting Direction

Future Now
1: many

Co creating a Learning Culture

Building Ambidexterity
Exploit Explore `

Action

E
Belonging
Me We Harmony

I
Debate

Organising

Structure Fluidity

Accessing Broadband Capability

Growing Capabilities
Development Delivery

Learning
dialogue Coherence
Diversity

Evaluating Progress
Purpose Process

Performing
1:1 Relational communication 2013 Henley Forum Embedding a Performance Challenge Culture

Trans-cultural competence

Personal Values

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Learning
Sense making

Mindfulness

Total Leadership

Sustaining Gravitating identity & to new community regimes

Charting Direction

Future Now
1: many

Co creating a Learning Culture

Building Ambidexterity
Exploit Explore

Action

E
Belonging
Me We Harmony

I
Debate

Organising

Structure Fluidity

Accessing Broadband Capability

Growing Capabilities
Development Delivery

Learning
dialogue Coherence
Diversity

Evaluating Progress
Purpose Process

Performing
1:1 Relational communication
2011 Henley KM Forum and Mastering Leadership Agility Ltd

Trans-cultural competence

Embedding a Performance Challenge Culture 32

References
Brooks, D. (2011). The Social Animal. New York, Random House. Choo, C. W. (2006). The Knowing Organisation: How organisations use information to construct meaning create knowledge and make decisions. Oxford, Oxford University Press. Sveiby, K.-E. (2012). Innovation and the Global Financial Crisis - Systemic Consequences of Incompetence in Challenging the Innovation Paradigm Eds K.-E. Sveiby, P. Gripenberg and B. Segercramtz. New York, Routledge. Bateson, G. (1972). Steps to an Ecology of Mind: A Revolutionary Approach to Man's Understanding of Himself. New York, Chandler Publishing Co an imprint of Random House. Bateson, G. (1979). Mind and Nature : A necessary unity. New York, Bantam Books. Smith, W. K. and M. W. Lewis (2011). "Towards a theory of paradox: A dynamic equilibrium model of organizing." Academy of Management Review 36(2): 381-403. Antonacopoulou, E. and R. Chiva (2007). "The social complexity of organizational learning: The dynamics of learning and organizing." Management Learning 38(3): 277-295. Leigh, R. (2000). The Radical Innovation Imperative. Boston MA, Harvard Business School Press. Hampden-Turner, C. (1990). Charting the Corporate Mind: From Dilemma to Strategy. Oxford, UK, Basil Blackwell. Stacey, R. (2001). Complex Responsive Processes in Organizations. London, Routledge. McKenzie, J. and C. Van Winkelen (2004). Understanding the Knowledgeable Organization: Nurturing Knowledge Competence. London, International Thomson. Colbert, B. (2004). "The complex resource based view: Implications for theory and practice in strategic human resource management." Academy of Management Review 29(3): 341-358. Storey, J. and G. Salaman (2009). Managerial dilemmas: Exploiting paradox for strategic leadership. Chichester, John Wiley and Sons. Eisenhardt, K. M. and J. A. Martin (2000). "Dynamic capabilities: What are they?" Strategic Management Journal 21(10/11): 1105. Easterby-Smith, M. and I. M. Prieto (2008). "Dynamic capabilities and knowledge management: An integrative role for learning?" British Journal of Management 19(3): 235-249. Crossan, M. M., H. W. Lane, et al. (1999). "An organizational learning framework: from intuition to institution." Academy of Management Review 24(3): 522-537. Seo, M.-G., J. M. Bartunek, et al. (2010). "The role of affective experience in work motivation: Test of a conceptual model." Journal of Organizational Behavior 31: 951-968. Lawrence, T. B., M. K. Mauws, et al. (2005). "The politics of organizational learning: Integrating power into the 4I framework." Academy of Management Review 30(1): 180-191. Schreyogg, G. and J. Sydow (2010). "Organising for Fluidity? Dilemmas of New Organizational Forms." Organization Science 21(6): 1251-1262. Arthur, W. B. (2009). The Nature of Technology : What it is and how it evolves. London, Allen Lane. Denison, D. R., R. Hooijberg, et al. (1995). "Paradox and performance: Toward a theory of behavioral complexity in managerial leadership." Organization Science 6(5): 524-540. Mengis, J. and M. J. Epler. (2005). "Understanding and managing knowledge-intensive conversations. A literature review and management framework." Retrieved 6th June 2008, from http://kmap2005.vuw.ac.nz/papers/Understanding%20and%20Enabling%20Knowledge%20Sharing.pdf. Kan, M. M. and K. W. Parry (2004). "Identifying paradox: A grounded theory of leadership in overcoming resistance to change." The Leadership Quarterly 15(4): 467-491. Bass, B. M. and R. Bass (2008). The Bass Handbook of Leadership Theory: Research and Managerial Applications. New York, Free Press: Simon and Schuster. Rickards, T. and M. Clark (2006). Dilemmas of Leadership. Abingdon Oxon. , Routledge Weick, K. E. (2009). Making sense of the organization: The impermanent organization. Chichester UK, John Wiley and Sons Ltd. Nonaka, I. and H. Takeuchi (2011). "The wise leader." Harvard Business Review 89(5): 58-67. Tushman, M. L., W. K. Smith, et al. (2011). "The Ambidextrous CEO." Harvard Business Review 89(6): 74-80. McKenzie, J., N. Woolf, et al. (2009). "Cognition in strategic decision-making: A model of nonconventional thinking capacities for complex situations." Management Decision 47(2): 209-232. Snowden, D. J. and M. E. Boone (2007). "A leader's framework for decision making." Harvard Business Review 85(11): 69-76. Biyalogorsky, E., W. Boulding, et al. (2006). "Stuck in the Past: Why Managers Persist with New Product Failures." Journal of Marketing 70(2): 108-121. Menon, T. and J. Pfeffer (2003). "Valuing internal vs external knowledge: Explaining the preference for outsiders." Management Science 49(4): 497-513. Hammond, J. S., R. L. Keeney, et al. (2006). "The hidden traps in decision making." Harvard Business Review 84(1): 118-126. Aram, E. and D. Noble (1999). "Educating prospective managers in the complexity of organizational life." Management Learning 30(3): 321-342. McKenzie, J. and P. Aitken (2012). "Learning to Lead the Knowledgeable Organisation." Strategic HR Review 11(6): 329-334. McKenzie, J., C. Van Winkelen, et al. (2012). Developing Effective Change Leadership to Build the Knowledgeable Organisation: A Paradoxical Foundation. ECKM. Cartagena Spain, Academic Conferences.

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Henley Forum for Organisational Learning and Knowledge Strategies

Thank You
Jane.mckenzie@henley.ac.uk www.henley.ac.uk/henleyforum

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Lots can go wrong

Source : http://www.nasa.gov/columbia/caib/PDFS/VOL1/PART01.PDF p34

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