I³ UPDATE
No. 17: March 1998

Contents

Creativity is not Innovation
Virtual Laboratories become a Reality
Making Sense of Mind Tools
KE (Knowledge Ecology) Fair Review - A Virtual Event
Some Real Events
Snippet

Editorial

Welcome to this issue of I³ UPDATE, a free briefing analyzing developments in the networked knowledge economy. As well as this Web version you can receive future editions via email. At the bottom of this edition you will find important information about leaving and joining our email distribution list.

And no, you did not miss the February issue, we did! Although generally we publish roughly once a month, there is no fixed timetable. These briefings are produced as and when there is something worthwhile to say.

We hope you enjoy this edition of I³ UPDATE, and welcome comments, contributions and feedback at david@skyrme.com.

David J. Skyrme
Managing Editor

Creativity Is Not Innovation

David J. Skyrme

I am continually struck by the number of executives who talk of the need for their companies to be creative so that they can innovate more successfully. Yet our own experience is that their people are very creative, so where do they go wrong? The first thing is that too often innovation is equated with invention. As has been said by many writers, including Rosabeth Moss Kanter in 'When a Thousand Flowers Bloom':

"Innovation is the creation and exploitation of new ideas"

Similarly, my colleague Debra Amidon writes in 'Innovation Strategy for the Knowledge Economy', that innovation is:

"the creation, evolution, exchange and application of new ideas into marketable goods and services".

Along with other observers of innovation, they stress that it is the CONVERSION of ideas into commercial revenue streams that is the essence of innovation. Idea creation is simply the starting point. Amidon uses the notions of an Idea Quotient (the percentage of employees with good ideas) and Innovation Quotient (the percentage of those people whose ideas finally make it into practice). The former is usually very high and the latter "woefully low", she says. The major challenges that organizations face in increasing the innovation quotient are:

• Sharing individual ideas so they become part of organization memory
• Nurturing relevant ideas and shaping them into projects and prototypes
• Encapsulating the resulting knowledge into products and processes and the organization's intellectual capital

This can be achieved by considering the innovation process in terms of flows of knowledge and its conversion between tacit and explicit - flows between people, codification into designs and databases, combinations and restructuring of knowledge into new forms and so on. And as we know today, this is not a neat, linear, sequential process. It depends on knowledge flows across various organizational and discipline boundaries and extensive informal networking by everybody involved in the product or service development process, including customers and business partners. Let's look at a few practical steps which can contribute to better innovation.

Creativity Techniques

Just in case you do need additional creativity, there is no shortage of tried and tested techniques, ranging from brainstorming to morphological analysis, from attribute analogy chains to synectics. If you want to learn about these, you could do little better than reading;

'Techniques of Structured Problem Solving' by Arthur B. Van Gundy

which describes over 60 idea generation techniques and another 30 or so for refining and applying them. Or you could get involved with one of the many specialist organizations who run creativity sessions, such as The Creativity Consortium in Canada (email Walter Derzko: wderzko@pathcom.com).

Develop Idea Banks

This is one way that organizations encourage individuals to have their ideas more widely exposed. "Don't tell your boss, tell us" runs the slogan of one organization's idea bank. Their aim is to get as many ideas from throughout the organization into the ideabank, which is then a source of ideas for others in a position to exploit them.

Companies like Hoechst Celanese not only encourage creativity, but provide some support for those with ideas to shape them into embryonic proposals that business managers can explore or invest in.

Run Knowledge Sharing Fairs

This acts like a marketplace of ideas, bringing those with the ideas into contact with people from business units, or even outside companies, who are potential investors in the much more lengthy process of converting the ideas into prototypes and products. Inventors and idea creators are given help in creating posters and 'stands' at an exhibition like setting. Quite often, separate workshops that discuss a range of comparable ideas also enrich the knowledge exchange.

Encourage Experimentation

3M is a company renowned for its innovation. They and other innovative companies allow individuals to spend a proportion of their time - typically 10 or 15 per cent - pursuing their own ideas and interests. In 3M their philosophy is to back people, not just projects. But more important in our own experience is that individuals AND the organization learn from such experimentation. Are the conditions of the experiments, and the results properly recorded? Is this learning readily accessible elsewhere? Do others in the organization know who was involved in experiments that could be of benefit to them?

Provide the Right Climate and Support

The above practices are all aimed at improving the processes of creation and conversion through better knowledge flow. However, the most crucial ingredient for success in our experience is the culture and climate of the organization and the attitudes of managers to these practices:

• If ideas do not work - are people encouraged to try again or stigmatized for failure?
• Are product development processes too formalized into stages with unrealistic hurdles to move from one phase to another?
• Are creative individuals forced to find market opportunities themselves or are they given help and support in making appropriate connections to the people and resources they need?
• Are ideas grabbed by those seeking the limelight with no recognition (or reward) given to their originators or shapers?

The nub of the management challenge is to balance a set of complex interactions. There is a judgement to be made between putting product ideas through formal processes yet encouraging informal experimentation; of allowing free and unrestricted knowledge flow yet protecting valuable intellectual property; of encouraging creativity yet accepting failure; of giving verbal support but not practical help and support. One practical way that is adopted by companies in collaboration with universities and other partners is that of the business incubator, perhaps the best example being those of IC² - the Institute of Creativity and Capital at Austin, Texas.

The Messy Truth

We have outlined above just a few practices that have proved successful. Yet in many companies they are not yet widely practiced. You will find other practices described in various books and reports on knowledge and innovation. In reality, innovation is a messy business, partly chaotic and serendipitous, that is not an easy bedfellow with scientific and systematized management processes. Why is it that many large companies are not as innovative as smaller newer ones? If innovation is to succeed in larger companies, lack of creativity is generally not the issue. It is providing the environment, people support processes and organizational climate that stimulates and supports Idea Conversion. Only then will organizations achieve higher innovation quotients.

Footnote: This feature appeared in 'The Creative Landscapes Column: Creatovation', Bob Muller, AI & Society, Vol. 12, pp.297-300, Springer-Verlag (1998).

Virtual Laboratories Become A Reality

David J. Skyrme

The recent IQPC event 'Managing the Virtual Laboratory' provided some useful insights into how corporate R&D laboratories are being transformed through the use of technology. While there was some disagreement on the meaning of the term 'virtual laboratory' (some said it was simply a dispersion of the function from one central lab to several distributed laboratories; others that it was any form of research collaborations through information and communications technologies) there was general agreement on several key trends:

• The devolution of R&D from central laboratories into business units; a shift from almost wholly central research to only 10 per cent done centrally was not untypical.
• The belief that research and innovation gain "robustness through diversity"; the need to collaborate across functions and between organizations and universities was increasing all the time
• That the world is the resource bank for knowledge - no single laboratory or company has all it needs for sustained innovation
• In turn this leads to better 'surveillance systems', that monitor technical and market developments - and where the talent is!
• The Internet is having a profound effect on the way that research is conducted and how global collaboration takes place - there were several examples in genetics and molecular biology where genetic data is pooled and shared
• The growing problems of information overload and being "challenged by search engine technology"
• That competitors may become collaborators and vice versa; every project is different.

The Virtual Laboratory in Practice

Participants were exposed to many examples of the virtual laboratory in action. We learnt about "sunshine engineering" where work is transferred around the world from one time zone to another to provide 24 hours a day project engineering. We heard how bioinformatics is speeding up the process of drug discovery targeting. We found out about a "spouses web", which serves the information and support needs for partners of global trotting executives who relocate - this is part of Schlumberger's strategy of being a "family friendly" company. We also saw video coverage of how effective laboratory design can enhance the environment for creativity and knowledge sharing.

As with all conferences, the participants gained a richness of input and interchange that is impossible to recreate on a medium such as this.

Two presentations which, in particular, provided useful insights were those of Dr Reid Smith of Schlumberger and Dr Heinz Hefter of Du Pont.

Schlumberger Joins Needs and Solutions

Reid Smith described Schlumberger's key processes that included technology watch, vision and road maps, portfolio analysis and concurrent engineering, Of particular interest was ClientLink in which researchers actively identify client needs, leading to joint research initiatives. The needs are stored on an internal WWW database in three categories:

1. A solution exists, and there is best practice that can be transferred
2. There is partial solutions with opportunities and capabilities for tailoring and/or joint development
3. There is no known solution.

This then forms one part of the equation of balancing needs with solutions. A key tool in Schlumberger's work is SINet (Schlumberger Information Network) that connects around 25,000 users at 500 locations in over 55 countries. Schlumberger's use of the Internet has been highlighted as a good case in several articles and books (see for example Mary Cronin Doing Business on the Internet). As well as all the databases you might expect, there are features that help knowledge sharing, such as project archives with project histories, discussion and decisions e.g. What are we doing? Why are we doing this? What have we learned? Such a resource helps Schlumberger capture the knowledge it generates and minimizes the knowledge drain caused when people move or leave.

Commenting on their knowledge management approach, Smith reiterated the need to integrate people, technology and processes. Their future plans are to "amplify their current efforts" by building on and nurturing existing communities of practice and (something we are increasingly seeing in knowledge management initiatives) borrowing ideas from journalism in helping the communication of knowledge.

Du Pont - Building Collaborative Networks

The presentation by Heinz Hefter described the role of his function as the "virtual hub" in a technology transfer network, that included 30 R&D directors and representatives from all business units, joint ventures and central R&D. He contrasted the old linear paradigm of R&D with today's more interdependent arrangements involving universities, other companies, national labs, information systems and legal advisers. Their approach involves six key aspects:

1. Strategic selection of project - selecting the development method (such as acquisition, in-house or partnership) based on a business-competitive strength matrix.
2. Selecting partners based on key criteria - world class competency, commitment, trust etc.
3. Matching projects and partners - meshing complementary competencies, matching interests, and in general creating a win-win situation.
4. Effective project management, with clear understanding of goals
5. A strong co-manager (business champion) who sets the pace, respects cultural diversity and has high credibility
6. Effective communications and networking, not forgetting the importance of face-to-face communications and local support infrastructures.

He cited several cases, such as the phase out of CFCs where Du Pont's collaborative virtual research had created new discoveries, and saved time and costs.

The conference posed a number of recurring challenges, many not unexpected as companies move to improve their innovation performance:

• How to shift from a competitive to a collaborative mentality, both externally and internally: "managers did not get where they are by being team players"
• How to protect intellectual property when knowledge is shared more freely; preventing leakage of vital knowledge
• Working across different cultures, both company and national
• Entry and exit strategies for collaborations
• The blurring of boundaries between companies and between employees, contractors, suppliers and partners
• Using technology effectively, to help people communicate as well as accessing information.

What did strike me is that R&D managers, like those in other functions, have to move much further and faster from behind their functional walls if their companies are to be leaders in innovation. The knowledge collaboration agenda and these challenges will provide fuel for thought, experimentation and output for many more conferences to come!

Making Sense Of Mind Tools

Jan Wyllie, Trend Monitor International

Both the information systems community and business managers are increasingly focusing on knowledge management and collaborative processes. At the moment, there is a significant need for clarifying thinking and discussion on these topics which are particularly fraught with cross purposes and misunderstandings. In this context, the concept of Mind should not be used in a way which begs the scientific and philosophical question of how Mind works and how it is related to the brain and the body. It should be sufficient to agree that Mind has at least two facets: consciousness which is all about experience, feelings and purposes, and tools which is about techniques, such as language and writing, for example, used by human minds to attain their purposes.

This article, based on the first stage of Trend Monitor's intelligence gathering and synthesis process called content analysis, outlines four trends that are already apparent, and introduces a classification schema for monitoring developments and selecting tools. It is based on analysis of material on some 75 or so mind tools. The trends we have identified represent shifts:

• FROM tools that try and replicate human thinking TO those that augment it
• FROM providing passive information TO delivering active intelligence
• FROM reasoning with text TO visualization and pattern discovery
• FROM logical proof TO felt experience.

The first three trends are in the 'emerging' category which means that they already represent early practice. The fourth trend is 'over the horizon', which means that we are beginning to pick up the first signs of something new and quite different.

Helping Humans Think Better

Trend 1 - FROM AI software that replaces human intellect TO methodologies that augment it.

Until very recently releases of new Knowledge Management Tools were predominantly the product of AI software developers increasingly applying neural networking and machine learning to problems, such as data mining and visualization which have hitherto been outside the reach of the human intellect. Content analysis suggests that the utility of this second wave of AI solutions is being increasingly questioned by a second wave of doubters. Meanwhile, a new generation of powerful mental enhancement tools based on knowledge of how people - i.e. potential customers - learn and think is coming onto a market which is becoming acutely aware of the knowledge deficit caused by information overload.

There is still a lot of disagreement among our sources on the nature and role of knowledge tools. One strand of thinking is epitomized by Michael L. Weiner in The Journal of AGSI. He says that AI systems:

"will spot the emerging problems, threats and warnings as they emerge from the data; learn from the data they are reading, answer specific questions, generate predictions and early warnings of changing scenarios, and alert to potential outcomes while there is still time to intervene and to take action".

His view is that a new generation of 'knowledge products' will be based on technology that is

"beginning to live up to and exceed the dreams and promises of over 30 years of artificial intelligence and computer science visionaries".

Content analysis of about 15 years of AI development suggests that at best its practitioners still have huge fundamental problems to overcome before machines can be claimed to have such awesome capabilities.

Most recently, Gene Bellinger, a long-term reviewer of AI tools, in particular the burgeoning numbers of data mining tools, has warned:

"There exists a whole set of false beliefs which contribute to our continuing failure to achieve what we set out to accomplish."

The small AI research community has been making these kinds of claims for years. What is different now is that people who are not computer scientists are developing software supported human process methodologies aimed at helping people interpret and make sense of the floods of information with which they are faced. An instance of this phenomenon is the view of a UK Economist, David Owen, who is cited in The Financial Times saying that the knowledge age "will favour the brightest brains".

Tools for assisting completely human processes are coming on to the market now. An excellent example is Natrificial's Brain (http://www.natrificial.com) which enables people to organize their own information / knowledge as thought webs encompassing their hard disk as well as Web sources and email. Update (1999) - This is now called The Brain.

Trend 2 - FROM providing passive information TO delivering active intelligence

During the 1980s the dominant electronic information paradigm was being able to design clever search queries to ferret and sort useful knowledge out of the massive chaos of mainly text. Now, it is being able to ask anything you like in any words you like to make the retrieval engine automatically retrieve what you want in order of relevance from an even larger chaos of text. Neither paradigm helps with the huge problem of the pertinent knowledge which the user simply does not know that he or she could or should ask for. There is evidence that the market is beginning to realize that what it needs is active intelligence whereby the person is presented with the intelligence he or she needs to know in a volume and form which can be assimilated in the time available, without even having to ask, let alone having to search.

An example is Agent Knowledgebase (from Agent Knowledgebase Associates), that targets the market for competitive intelligence with the proposition "Information alone is not enough". Agent knowledge base uses 'knowledge objects' produced by experts who find intelligence which is described as "the careful collection, integration, synthesis, and analysis of information that brings critical insight to business decision-making". Agent Knowledgebase uses a combination of the kind of intelligence that can be encapsulated in software and human intelligence to assist in thinking about the right questions and in designing and interpreting feedback loops. On the human interpretation end of the spectrum, content analysis research techniques are becoming increasingly recognized as being useful tools in the delivery of active intelligence.

Trend 3 - FROM reasoning with text TO discovering new patterns through visualization

The need to deal with vast amounts of information has been driving the trend towards graphical representation of knowledge. Currently, there are many inconsistent graphical formats being tried and tested. In time, conventions will become established, and eventually they will become standards. When this happens, humanity will begin evolving a new visual metalanguage. Tony Buzan's MindMaps are an early form of a visual language. The influence that this new level of human language and human interaction tools will have on consciousness is likely to be profound, as shared insights and understandings become much easier to achieve. In a world of visual language, people's understanding of reality is likely to depend much less on linear chains of cause and effect and much more on cyclical organic patterns.

The trend towards the visualization of text-based thinking (hitherto known as illustrations and diagrams) is evidenced in both human and automated Mind tools. The new Natrificial Brain tool enables people to see their thoughts in simple patterns based on easy to understand parent child hierarchies and associations. The now classical practice of Mind Mapping has emphasized for years, the importance of involving more than one sense in the learning process. As yet, there has been very little interest in the aesthetics of visualization. However, it is reasonable to think that the more attractive a visualization looks, the more effective it will be as a learning tool.

Trend 4 - FROM logical proof TO felt experience ( ... over the horizon)

Western thinking attempts to validate the 'truth' of a proposition by logical proof, whether that proof is inductive or deductive. This kind of thinking is behind the scientific method which is now the dominant, even official, truth validation process. The kind of belief that the logical validation process encompasses is a truth that is outside of ourselves which can be manipulated using the power of logic. It does not encompass the kind of truth by which most people make most of their decisions most of the time - even scientists. This totally separate form of truth takes the form of what philosophers are now calling qualia, the felt experience of being in the world in the full sensuousness of all the perceptions which make up that experience. Our Mind Tools Knowledge base already contains evidence that leading thinkers in knowledge management and intangible economics are increasingly emphasizing the importance of experience and personalized stories in creating beliefs and are warning of the extreme danger of the mental hegemony of the scientific method which by its nature disregards people's connected experience and separates them as isolated egos from the world which envelopes them. While scientific thought cannot be denied - science created the atom bomb and the space ship - its precepts may be too dominant, creating a dis-functional or purpose defeating imbalance at the heart of people's learned thought processes.

Our analysis finds a discontinuity in very recent sources about belief validation. The same kind of thinking is simultaneously arising from a variety of seminal 'wellsprings' of knowledge. About three years ago, we began picking up from innovative sources, such as RSA lectures and Internet newsgroups, material which considered consciousness in direct experiential, rather than indirect cognitive terms. This thinking is now beginning to emerge into the public domain, through books, such as David Abram's, The Spell of the Sensuous, which invokes the pre-literate state of consciousness in which people "experience their own consciousness as simply one form of awareness among many others". He warns against "projecting the solution somewhere outside of the perceivable present" which "dulls our senses", and argues that "a genuinely ecological approach does not work to attain a mentally envisioned future, but strives to enter, ever more deeply, into the sensorial present".

There are already members of the knowledge management community who are beginning to explore these questions. For example, Ted Lumley is emailing his private intelligence list on the theme of knowledge management and the role of language. Only last week he was writing:

"the choice between 'rules-first' (generalizations first) versus 'creative patterns-first' corresponds to choosing to see the world in terms of tangible things (icono-causally) or in terms of evolutionary flow (tuning-in to evolutionary patterns). Lau tzu put it like this; [Lau tzu lived in the same era as the young Heraclitus]: Ever desireless, one can see the mystery. Ever desiring, one sees the manifestations."

Readers may well at this point be asking how is this re-evaluation of human truth validation and decision making is pertinent to business. The short answer is that if it happens, it will transform business into something nobody yet knows. For this reason alone, it is important to monitor its development, first to see whether this thought-seed continues to grow, and second to learn ways of adapting and benefiting from it, if it does.

Editor's Note: Shoshana Zuboff wrote in 'The Age of the Smart Machine' (available at at Amazon.com) about how the use of computers was disconnecting users from physical reality, replacing it with symbolic representations. Thus, chemical plant operators at a screen were not able to tap into the tacit knowledge they had developed over many years by being able to hear, smell and feel the plant they were controlling. How much does your own computer systems disconnect their users from reality and their physical senses?

See A Reader Replies

Evolving The Knowledge Base

Readers are invited to contribute their own views on these four trends. Simply number responses 1) to 4). The views of the readership will then be added to our evolving Mind Tools database and summarized in a future edition of I³ UPDATE.

New Schema For A New Collection

Research on knowledge management shows how much more readily knowledge is shared by using classification schemas (Price Waterhouse's International Business Language^SM as used in their KnowledgeView^SM databases is a good example). As a new topic area evolves, analysts like ourselves need to devise a multi-dimensional classification schema which is intuitively understandable and then test it against samples of source information. It also needs to be evolved over time as user perspectives adapt. The schema below is the third iteration for our Knowledge Management/Mind Tools classification. It is the result of content analysis of suppliers leaflets and white papers, published articles and reviews, and Web-based searches over the last year.

Each tool is classified in a text database according to its functional attributes. For example, Data mining fits under THINKING / Knowledge Discovery and Intelligent Agents under CONTENT / Search but also under CONTENT / Filter. It is not surprising that some tools are more specialized while others have more broadly based functionality. Hence, a single tool may well have multiple classifications. In the database, the information collected about each tool is judged along a hi-mind, hi-tech spectrum (on a scale of 1 to 5) according to whether it is designed to enhance natural human mind functions (1) or to replace and improve on natural human mind functions using automated processes (5), c.f. trend 1 above.

Knowledge Management Tools Schema

(c) February 1998. Trend Monitor International. Ltd.

Analyses Available

The database of tools we have gathered together from published sources and the Web is possibly the broadest and most coherent set of structured information that currently exists on knowledge management tools.

It will be used as a primary resource for Knowledge Kaleidoscope, a joint venture of Trend Monitor, David Skyrme Associates and ENTOVATION International. In the meantime, tools producers or others who wish to avail themselves of the analysis and research can do so through Trend Monitor's customized briefing and reports service.

Trend Monitor International Ltd.
*The Information Refinery*
3 Tower Street, Portsmouth
Hants, P01 2JR, UK
Tel: 44 (0)1705 864714
Email: jan@trendmonitor.com
Web: http://www.trendmonitor.com

Update (Aug 1999) - Knowledge Kaleidoscope does not yet exist as a separate publication. The classification and analysis has been updated and incorporated into Knowledge Trends Analysis.

The Knowledge Ecology Fair

A Virtual Event

This interesting virtual event, that we co-sponsored, is now over. It ran from 2-23 February and had an interesting mix of workshops, open discussions, presented papers. Many excellent interchanges took place, and participants could move from open space to coffee chat to a tools and library area at a time that suited them.

In reviewing the fair, one of the organizers, Amy Eustace of Metasystems Design noted:

"One of the biggest challenges of the Fair is coping with the large volume of interesting and valuable contributions being generated in all the sessions".

Certainly there was much to choose from, and if you wanted something that was not covered, you simply created a new strand yourself! Essentially, you got out of this event what you put in. Unlike traditional conferences, where you are generally a passive participant, such a virtual event provides a more balanced approach, with presenter entering active dialogue with their audience.

My only hope is that someone will do a knowledge editing job, so that those, like me, who should have spent more time there but were unable to, will at least get some real proceedings from this virtual event!

Some Real Events

Knowledge Management in Oil and Gas, 5-6 March, London. First Conferences.

Increasing Customer Loyalty through Knowledge Management, 10-11 March, London. World Trade Conferences.

Facilitating Corporate Innovation via Knowledge Management, 1-2 April, New York. ICM. Meet me there and hear my talk "Avoiding the Measurement Trap". There is also 1 day post-event workshop by ENTOVATION on 3rd April - Practical Tools for Creating a Knowledge Innovation Strategy.

Knowledge Management, 2-3 April, London. Learned Information.
http://www.knowledge-management.co.uk

Intranets for Knowledge Management, 4-6 May, New York. First Conferences.
http://www.firstconf.com

Developing Value from Knowledge Management, 1-2 June, London. SMi.

Snippet

NSF Initiative in Knowledge and Distributed Intelligence (KDI). With an expected budget of $62 million for fiscal 1998. Letters of intent deadline - April 1, 1998. Full proposals by May 8.
http://www.nsf.gov/kdi

© Copyright, 1998. David Skyrme Associates Limited and Authors - All rights reserved.

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