Question 1

Effectively managing people is crucial for knowledge management and the ongoing change it generates.

(a) Managing an expert workforce needs effective human resource interventions. Introduce and summarizefourkey criteria for managing people and gaining their commitment to knowledge-productive change in the organization. Use these criteria to identify and discuss both what Sci-Con is doing well in this area and how it can improveits knowledge management practices. (12 marks)

(b) People's willingness to share knowledge is essential to knowledge management. Identify and summarize three themes discussed across this course that shape people's willingness to share knowledge. Discuss their implications for managing the expert workforce at Sci-Con. (6 marks) - Do not use participation criteria

Question 2

Sci-Con has made very limited use of technological systems in managing knowledge.

(a) Identifythree Knowledge Management Systems that would be relevant to work at Sci-Con. For each of these three systems: (i) introduce and summarise its key ideas and functions, and (ii) discuss how it can assist the organization in improving its management of knowledge. (12 marks)

(b) Discusstwo ways by which Sci-Con can make effective use of these systems by balancing its approach to technology through consideration for people. (4 marks)

Two-hand approach to balance technology.

Access, change

Case Study Sci-Con

Sci-Con was founded in 2005. Today, it is a medium-sized, technology-based consultancy company, located on the outskirts of London that operates on a global basis. At the time of its inception, the founder wished to create a consultancy environment that would not only develop solutions in response to client problems but also stimulate invention and innovation.

Since its founding, the firm has grown from a small business employing a handful of science consultants in engineering and communications to a medium-sized company employing about 200 people and incorporating other scientific disciplines such as biotechnology, applied sciences and information systems. 85% of the workforce are highly educated scientists and technologists who rely mostly on their expertise and knowledge to provide inventions and innovative solutions for companies around the world.

The workforce is truly international, incorporating 19 different nationalities. Sci-Con is in the business of creating new knowledge and applying existing knowledge in new ways. Consultants work in interdisciplinary project teams to develop completely new concepts and products that are marketed to clients. They also develop solutions to client problems using existing ideas and technologies in new ways. The firm has contributed to major scientific and technological developments that are recognized and used throughout the world.

A crucial issue for management at Sci-Con has been attracting and retaining a highly skilled, expert workforce of international standing in order for the firm to grow and successfully compete on a global basis. Thus, developing an appropriate organizational environment in which expert consultants are keen to work has been of paramount importance.

Attempts have been made to maintain a flat organizational structure throughout the firm's development. Even today, there is fundamentally only one level of management, consisting of the founder (now Executive Chairman) and Managing Director. Decision-making within the firm has typically involved significant numbers of consultants as well as management.

Management communicates constantly with the whole of the firm, usually using email, regarding new projects. Turnover and profitability are also communicated to everyone on a monthly basis. Consultants are encouraged to innovate outside of client project work, and they can request financial resources for this through the Innovation Exploitation Board. This forum includes consultants from across the firm and the management team and it meets regularly to discuss the feasibility of new ideas proposed by consultants. All members of the management team are also consultants, contributing to project teamwork within the firm.

Consultants are organized across three divisions within the firm according to their scientific expertise. These are Business Innovation (BI), Technology, Internet, Media and Entertainment (TIME), and Engineering (ENG). While divisional managers lead divisions,

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there are no hierarchical levels. Divisional managers tend to be individuals who are prepared to take on some administrative responsibilities such as recording revenue generation and monitoring the projects while also actively contributing to project work across the firm. Consultants tend to work in an interdisciplinary manner across divisions in small project teams that are self-forming and self-managed.

For many years, the firm did not employ a Human Resources (HR) manager. However, in 2010, based on predicted and expected project work, the firm needed to increase the expert workforce by 15% (projected to continue annually). The firm recruited an HR manager to develop a more formal recruitment process and high retention rates across the firm.

In the past, consultants had been recruited informally, drawing upon global personal networks of colleagues and contacts. To make the recruitment process more effective, the HR manager developed good relationships with two international recruitment agencies. Once provided with a person specification and a brief that described the work, they provided shortlists of candidates on an ongoing basis. The firm did not look for an ideal profile other than 'openness' and a 'willingness to experiment'. Most candidates who are shortlisted proceeded to a short interview with the HR manager and divisional manager.

During this preliminary interview, the HR manager stated that candidates were expected to demonstrate a strong understanding of their own and, more importantly, other disciplines, because of the need to work in interdisciplinary teams sharing knowledge. They were also expected to be 'almost naturally innovative' and have a strong commercial awareness.

Approximately 25% progress to a second interview. Management is interested in individuals with a PhD or expertise in a scientific discipline, who are fluent in English, and have commercial experience. The role involves marketing their own and the firm's abilities and expertise. It is therefore a unique set of characteristics which is sought in candidates.

The second interview focuses on assessing the candidate's ability to market to clients, their overall level of expertise, and their ability to work within interdisciplinary project teams. This interview involves consultants from several divisions who 'quiz' the applicant in depth on their knowledge of their own and other science- or technology-based fields.

The selection process is described as 'rigorous' by the HR manager. He emphasized that the interviews focus primarily on the candidates' ability to 'fit in' to the Sci-Con way of working. This involves willingness and ability to collaboratively share knowledge across different science- and technology-based fields, both within project teams and more generally. The HR manager commented:

You get a CV, and the person has a PhD, and they've worked for a high-powered research agency, and that's brilliant. You've got to see them, but you know that there is a strong chance that the moment you meet them you're going to know what they're not - they're not one of us.

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Only one formal system exists at Sci-Con, and this is the performance management system that was introduced in 2010 at the same time as consultants were allocated to divisions. The system focuses on divisional revenue targets (DRTs) and personal revenue targets (PRTs). Management establishes these targets at the beginning of each financial year, and they are monitored monthly.

Revenue is generated through project work. A lead consultant has the most contact with a particular client and is responsible for negotiating the value of the project. Lead consultants use email to inform consultants throughout the firm about potential new projects and the skills and expertise that will be required. Once the value of a project has been determined with the client, it is the responsibility of individual consultants who want to work on the project to negotiate the amount of project revenue they will get. As there are no formal systems to record these negotiations, email messages serve as a record. The project revenue contributes to the individual consultants' PRT and DRT. Management described PRTs as a scheme for making people sell their skills to others in an effective manner:

It is a micro economy. It is a free market for expertise. Over the years it has been the subject of much controversy as it puts pressure on people, and it is how we try to maintain a competitive environment. It does create tension, but at the same time, it enhances innovation given by the rate at which new ideas come out of the organization.

Achievement of PRTs consistently is expected of everyone. However, occasionally divisional managers find it difficult to achieve their DRT. At the end of each financial year, divisional managers performance-rank consultants based on achievement of PRTs and contribution to sales. This is a transparent process and consultants are free to discuss their ranking position.

Underperformers are tolerated in the medium term. Consultants who do not achieve PRTs over time do not receive a salary increment, but they are actively encouraged and helped by management to improve performance the following year. Management has never introduced salary scales within the firm, and no formal career structure exists because there is a no formal hierarchy. Individual consultants are therefore awarded a percentage increase based on the salary they have personally negotiated when they were appointed to the firm.

Consultants are free to choose their hours of work and length of vacations. This means that some consultants work continuously, occasionally for months at a time and then take extended vacations. Other consultants choose to work regular hours and take shorter breaks.

Professional development is important to all consultants at Sci-Con. To stay at the top of their professional fields, consultants must be aware of developments and need to participate in activities for professional development. Again, consultants are responsible for identifying their own requirements in terms of courses, conferences and workshops. Management provides the necessary financial resources. It is assumed that consultants will organize their workloads to include professional development without disruption of project work.

Training for consultants has never been considered an issue within the firm. Management has always believed that the quality of the people employed negates a need for training. It is assumed that if dedicated training is required, e.g., in the use of software application for project work, then consultants are sufficiently skilled to train themselves.

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Significant resources have always been made available for investment in any technology that might facilitate project working. The email system was used extensively as there were very few formal systems or procedures in use for communication, and significant numbers of consultants would be working remotely at client firms. Consultants were receiving between 100 and 150 emails each day, and despite attempts to cut back on the use of e-mail for trivial matters, consultants still receive about this number.

It is the email system that is generally used to broadcast requests for information when putting together proposals for clients. Anyone who wants to be involved in a potential project initially communicates in outline their potential contribution. The medium is good for communicating low-level information, quickly and across the whole firm. However, the level of email communication consultants are exposed to on a daily basis is recognized generally as a significant burden. Norms have developed, such as sending replies to everyone in the firm and failing to edit the title of emails to ensure that it relates to the content of the email. These norms have generated a somewhat chaotic and haphazard system of communication. For example, some consultants, when faced with ever-increasing numbers of email, choose not to bother reading the majority unless absolutely necessary.

Other technologies are occasionally used and intranets have been set up. Consultants are aware that some packages can provide useful project documentation. However, the majority of projects continue to be documented in a highly idiosyncratic manner because project leaders are free to provide documentation in whatever way they deem appropriate. However, if the client is satisfied with the documentation produced, no further effort is directed at producing, recording, and classifying project documentation in a consistent manner across the firm. Again, consultants are trusted to produce high-quality project documentation, without recourse to formal standards, systems or procedures.

The use of the intranets tends to be fragmented and groupware tends to be used only when geographical constraints impose a need to work in this fashion. Consultants prefer project team-working to be face-to-face. In many instances, when significant decisions or results need to be shared across a team, they simply schedule a conference call.

From the outset the founder wanted to promote an innovative environment that would stimulate creativity. An emphasis was placed on maintaining an egalitarian culture, one in which everyone was in principle free to contribute to decision-making, and one that allowed individuals' relative freedom to be creative. While the founder was keen to promote a corporate culture around a set of core values (especially the importance and value of creativity and innovation), he respected individuals for who they are. He did not, therefore, attempt to develop a strong culture with particular norms of behavior. The Sci-Con way of working is therefore characterized by a lack of prescription, informality, and idiosyncrasy.

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The diversity of the workforce exemplifies the importance placed on individuality within the firm. Not only are 19 different nationalities represented, but there are also significant differences across the firm with regards to age, experience and general attitudes and behavior. Individuality often tends to manifest symbolically in dress, ranging from the bizarre (e.g. running shorts in the depths of winter) to the more traditional conformist dark suit and tie. During project work, however, diverse groups of individuals with differing expertise are expected to work together jointly, developing solutions to client requirements or problems. While conflict inevitably arises across such a range of diverse individuals, the environment is one in which individuals feel free to speak out without recrimination. Consultants are trusted to resolve any differences that might arise without recourse to the management team, so that ultimately client requirements are satisfied.

While everyone agrees that the organization is almost flat, it is widely recognized and acknowledged that a dynamic, informal hierarchy exists based on expertise. However, consultants differ (sometimes considerably) in their opinions of the hierarchical ordering based on their personal experience of working with others in the firm. One consultant stated,

Nobody in theory has a job title. Single status applies but some people are seen as more powerful, more influential, higher status than others - based purely on what they are seen to contribute to the organization in terms of big projects or particularly innovative ideas.

Individuals across the firm can therefore command powerful positions within the informal hierarchy. Their position will be based on their ability to both acquire new business and command large proportions of project revenue that contribute to their PRT. Positions within this informal hierarchy, however, are transient and relatively ephemeral, as new clients and new projects requiring different skills and expertise are acquired over time.