Conversion to 'Knowledge Factories'
When Peter Drucker first talked about the 'knowledge worker,' he was
referencing the high technology professionals. When Karl-Erik Sveiby wrote
about the 'Know-How' company (1987), he was referencing the services
sector. As the knowledge profession evolved, we have all realized that the
knowledge communities reside within and across all functions, sectors and
regions of the world.
Perhaps the least well known is the manufacturing sector.
The integration of technology-push and market-pull (i.e., supply/demand,
needs/seeds) ultimately come together in the manufacturing function - or
the conversion phase (i.e., between creation and commercialization) within
the process of innovation. With intensified global competition and
companies that were more expert at commercializing technology - even from
other countries, focus on the production aspects of goods and services
Previously relegated to third-class citizenry in the corporate ladder - and
in the professional schema - manufacturing engineers were put to the test.
Not only were they able to display their prowess with statistical analysis,
being first to embrace the quality agenda enables them to provide corporate
leadership in team-building as well as with customer interaction. Instead
of being perceived at the end of the value-chain, customers were perceived
as the heart of the Quality Function Deployment (QFD) process.
A Refocus on Manufacturing
Across the nation - and indeed the world - there was an intensified focus
on the manufacturing sector of the economy and its role in international
competition. There was an appreciation for the conversion process within
traditional industries, the services sector and the transformation of
What emerged is an intensive movement to promote corporate agility, which
that had its roots in the manufacturing sector. Today, the Agility Forum
(they have dropped the word manufacturing from their title), which is based
at Lehigh University, boasts a significant cross-industry membership, with
research initiatives ranging from change management to 'Next Generation
Manufacturing: Plan for Action'. Its conference agenda, similar to other
manufacturing forums (e.g., the National Center for Manufacturing Sciences,
the Center for International Manufacturing Systems) resembles one of an
organization dedicated to the process of innovation. They even produced a
1997 NGM imperative paper on 'Innovation Process', which builds a bridge
between technological innovation and the learning process.
"Only decades ago, the concept of producing defect-free products (i.e.,
zero defects) was at best a slogan something to rally around, certainly
not attainable or even necessary. Today, it is part of the price of
admission for manufacturing companies approaching six sigma (3 parts per
million) quality levelsThe ability to innovate not only products and
services, but also processes, strategies, organizational structures and
enterprise designs and to rapidly change them, will become the next
discriminator, and perhaps the (new) price of admission for U.S.
manufacturers in the world marketDevelopment (therefore) of any innovation
strategy should be viewed from both the micro- and macro-economic levels."
Ten Steps to Manufacturing Innovation
One way to begin to calibrate the innovation process is to view the
system-as-a-whole by answering the ten questions outlined on the ENTOVATION
Litmus Test - http://www.entovation.com/assessment/litmus.htm - that
provide manufacturing professionals with a broader view of the innovation
system within which manufacturing responsibilities lie. These ten steps
enable a company to see where it is on the scale of innovation management
capability and provide a foundation for strategy formulation. As with any
corporate-wide initiative, companies must establish key players, agree upon
a framework for dialogue, create an implementation plan (ideally after all
stakeholders have been interviewed), manage the process, evaluate results,
and be open to new ideas and unexpected business opportunities.
- Foremost, the innovation process should be made explicit by identifying
a corporate officer and cross-functional team responsible for the process.
Innovation can be stated as a core value of the firm, thereby ensuring that
all participants in the process recognize its importance.
- Once the process if defined (i.e., cradle to grave, seed to need,
etc) including the roles and responsibilities of all stakeholders, attempt
should be made to define the metrics of progress both tangible and
intangible that define optimal performance of the 'system'. Recognize that
metrics that are difficult to define may be the vest measure of success.
Develop the business case based upon the new Knowledge Value Proposition
(i.e., the relationship between economics, behavior and technology) that
promoted the creation, exchange and application of new (or reused) ideas.
Develop key indicators and early warning signals that might be tracked in a
periodic review. Be attentive to what incentives can be built into the
system to foster behavior necessary in an innovative environment.
- Take stock of the education/training capability of the firm and from
where ideas originate. Consider the implications of a 'real-time' learning
environment that may not be classroom-based. Provide an infrastructure for
the incubation of new business ideas that might develop into products
/services and even new businesses that might contribute to the bottom line.
- Consider your local, national, regional and worldwide presence. How
might these locations be converted into a distributed learning network that
treats stakeholders, including customers, as sources of knowledge, rather
than someone to who services are 'delivered'? The network however it is
defined - operates far more as a system of conversations, rather than a
value-chain transfer or delivery mechanism.
- Pay attention to the competitive environment, but be sure that your
radar searches wide enough to capture potential competitors who may not
even be a factor in your industry today. Ensure than any intelligence
activity is designed as a feed-forward that automatically distributes
insights to those with a 'need to know'. Where appropriate, rely upon
available computer and communications to facilitate the process.
- Review the metrics of your own product and service development for
example, the number of new products/services yielded in a given business
period as a percentage of sales. Perform an in-depth analysis of the
Knowledge Economy (i.e., projected trends) and determine the implications
for your business. Consider some new adaptations that capitalize upon
knowledge-based products and a new knowledge-delivery channel.
- Take stock of the variety of your strategic alliances research, joint
venture, cooperative marketing, etc. Determine how they are being managed
in ways that are consistent and aligned with your values and corporate
strategy. Document successes and failures. Consider the portfolio of
research alliances developed by your competitors their inherent strategy
and the potential impact on your performance.
- Review your media/advertising strategy to assess how it portrays your
intellectual and innovation capability. Furthermore, review your current
level of customer intimacy from a sales, relationship and partnering
perspective. Could a focus on customer knowledge rather than knowledge of
the customer - reframe prospects for customer innovation?
- Rethink your leadership strategy both internal and external. The
Knowledge Economy is an economy of opportunity, not problem-solving. It is
an era of collaborative, not competitive strategy. It requires visible
sharing of your own knowledge and on a worldwide stage. Determine your
sphere of influence and how to best leverage the talents of your own workforce.
- Assess your technical infrastructure for internal and external
communication (e.g., computers, software, multi-media, intranets, Internet,
videoconferencing, collaborative applications, e-markets, et. al.)
capability and the management effectiveness. Consider the overall behavior
necessary in the innovative environment and determine if the given systems
afford opportunities to manage the corporate memory, enhance electronic
dialogue, deliver on-site training and learn from participation for
continuous process improvement.
In short, position innovation strategy and management as a core competency.
Make the process and the management and measurement thereof explicit.
Illustrate how it can be seen as the migration from Business Planning -
http://www.entovation.com/whatsnew/atlas1.htm - with more dynamic, robust
models for ensuring future success than documenting past performance.
Ensure that individuals ideally representing the 3-Gs (Generations) are
motivated and rewarded for enhancing innovation. Take into consideration
the relationships inherent in the 'Extended Enterprise' or the 'Strategic
Business Network' (SBN) suppliers, distributors, alliance partners,
customers, customer's customers and even competitors. Avoid punishing
failure as you are building a common innovation language and culture of
'constructive innovation'. And by all means, celebrate progresseven the
The Knowledge Factory
Over the years, the focus on manufacturing has evolved to the concept of
the 'factory'. ENTOVATION Colleague Kevin Meyer was one of the first to
integrate the knowledge concepts into the manufacturing frame with a
Website http://superfactory.com - and collaboration with
http://www.Virtual-Workshops.com in which interested industrial
participants are connected to instructors and other participants by using
specially developed web conferencing software, an Internet connection and a
phone line. Virtual-Workshops has conducted workshops for several thousand
employees of DuPont, BP, Amoco, Exxon, Kodak, GM, Nordstrom, and 250 other
companies. Programs are available in the following categories:
- Manufacturing (over 40 courses)
- Engineering/Quality (over 35 courses)
- Business/Leadership (over 13 courses)
- Safety/Environmental (over 5 courses)
- Facility Management (over 29 courses)
There are numerous other relevant publication is the field providing
leadership for the manufacturing function and overall enterprise leadership
such as 'Manufacturing for Survival: The How-To Guide for Practitioners and
Managers' by Blair R. Williams (1995); 'Fast Track to Waste-Free
Manufacturing: Straight Talk from a Plant Manager (Manufacturing and
Production)' by John W. Davis, Steven Ott (1999); 'America's Best: Industry
Week's Guide to World-Class Manufacturing Plants' by Theodore B. Kinni
(1996); 'World Class Manufacturing : The Next Decade : Building Power,
Strength, and Value' by Richard J. Schonberger (1996); to mention a few.
And there are other factory concepts being realized by the Global
Factory http://www.globalfactory.net/ - which has received $13M in first
round financing. Positioning themselves as "the next step for
e-collaborative manufacturing", the Global Factory Network is the first
'collaborative manufacturing execution platform'. For the first time, all
parties in a manufacturing chain can operate as if communicating from
within one enterprise. This breakthrough development means that outsourced
manufacturing can now be globally managed as easily and consistently as
Benefits from Benefits of the Global Factory Network include:
- Reduced levels of work in process inventory: Improved visibility
throughout the production process reduces the need for safety stock, and
allows the supply chain to run dramatically leaner.
- Improved delivery performance: Improved visibility, plus date change and
process boundary alerts, mean that orders no longer slip through the
cracks, and that surprises are caught and responded to earlier than ever
- Easier to establish new collaborative manufacturing relationships: The
speed and ease with which the Global Factory Network allows companies to
become productive members of the network, and then link with others, means
that production tracking no longer is a gating item to establishing
manufacturing relationships. This allows Global Factory Network members to
take full advantage of the global nature of today's electronics supply
chain, and the matchmaking ability of upcoming supplier exchanges.
- Improved Customer Service: Customers can be given order visibility
privileges, thus reducing the level of routine status questions being
answered by customer service personnel, improving customer confidence in
your delivery ability, and providing a valuable new self-service feature.
- Streamlined new product introductions: Everybody in the CM supply chain
can be on the same page right from the start of a new product manufacturing
run. The Global Factory Network distributes the right production data to
each member of the chain, correctly and seamlessly.
- Improved Employee Productivity: No more frustrating production control
meetings, struggling to cope with incomplete or inaccurate production data.
No more calling around to get updates, faxing production reports, e-mailing
spreadsheets, and all of the other time wasting, productivity sapping
elements of the typical current 'system'.
These benefits could easily be attributed to an effective innovation
system not necessarily the improved manufacturing function. This is an
illustration of how each functioning the 'Community of Knowledge Practice'
- http://www.entovation.com/innovation/cokp.htm - is moving toward an
understanding of the entire 'system' in order to understand the function in
of the parts. It is also proof-of-concept that, indeed, there is a
leadership role to be performed by those in the industrial sector (not only
services) - and the manufacturing function at that- in the Knowledge Economy!
Email: Debra M. Amidon
© Copyright, 2001. David Skyrme Associates Limited and Authors - All rights reserved.
I3 UPDATE / ENTOVATION International News is a joint publication of David Skyrme Associates Limited and ENTOVATION International Limited - providers of trends analysis, strategic advice and workshops on knowledge management
and knowledge innovation®
® Knowledge Innovation is a registered trademark of ENTOVATION International.
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