In our previous article, we explored how optimizing knowledge processes enables organizational transformation from a culture of blaming towards a culture of accountability. A key lesson learned was that only with active involvement of all parties involved, facilitated through knowledge management practices, can such a situation come to fruition.
Recently, we have been discussing an idea suggested by Forbes that Knowledge Management facilitates decision making, enables the building of a learning organization, as well as creates a culture of knowledge sharing and innovation. In this segment, we focus on the intimate relationship between better decision making by leaders and knowledge management at a personal level.
In order to make high-quality better decisions in volatile and highly uncertain and complex business environments, three requirements need to be fulfilled. The first is the ability to undertake assumptions analysis. The second is the ability to suspend unilateral perspectives in favour of multiple perspectives when attempting to understand the situation and complication being faced. The third is the ability to make a decision that meets the short-term, as well as long-term, aspirations of all stakeholders involved.
In highly complex and uncertain business environments, leaders have to rely on their gut feel and intuition to decide on the best way forward. They are forced to decide based on limited, changing information and make assumptions on what other issues impact their proposed decisions. This was an acceptable practice in the past but is not the case anymore. Today, the volatility and extremely complex interrelationship between different elements of the business environment renders the tendency to assume a very risky option to undertake.
To minimize the risks associated with making incorrect assumptions, leaders need to identify and acquire critical information either through the association of people who have relevant experience or be able to intelligently analyze data to guide and assess the assumptions they make. As a result, the knowledge acquisition process needs to be optimized through enhancing the ability to connect with people who have the necessary expertise at short notice and the expertise to analyze information intelligently.
Rapid and significant changes have become commonplace occurrences these days. There have been cases where what appeared to be the “obvious” decision to make from a leadership standpoint, led to a nightmarish outcome. A case in point is the decision by Nokia to downplay the advent of Apple’s iPhone. According to Nokia leaders at that time “such a phone will not go far” in 2007, led to the demise of Nokia’s leading position as a cell phone retailer.
With the complexity and interdependency of technological start-ups, including the advent of artificial intelligence and advanced robotics, boundaries of technological developments are becoming increasingly blurred. Under these circumstances, where leaders are limited to their current level of superficial understanding, within the confines of a limited point-of-view, when making critical decisions. Given their limited comprehension of the unprecedented evolution of technology that is unfolding before them, we clearly need a more effective means of making such critical decisions.
The only way to make better decisions in such situations is through the production of knowledge that broadens the understanding of the emerging business environment. This requires the involvement of all stakeholders in terms of sharing and producing knowledge on a regular basis. This will over time, enable development of a more holistic and multi-perspective view of issues. These perspectives shared and discussed amicably through dialogue using Knowledge Management techniques such as the Knowledge Café will go a long way in extending options available to leaders in dealing with issues that are ambiguous in nature.
Balancing short and long-term needs of stakeholders
In general, the thinking process of people involves perceiving what is happening, and from that perception, developing an understanding of how what is happening, affects the well-being of the person, followed by making a decision on what to do, based on the level of understanding the individual has achieved.
When this is done by one person, such as a leader who has to decide on the next course of action, his or her perception may be clouded by inaccurate or incomplete information that could lead to a superficial understanding of the situation and complication inherent within it. Consequently, the decision made may be suboptimal and at times disastrous. This is by virtue of the fact that all stakeholder considerations were not made and the decision most often is based on good short-term returns without considering long-term implications of these decisions.
To mitigate the negative outcomes of a wrong decision and to minimize the possibility that sub-optimal decisions are made, leaders need to develop a knowledge management capability that optimises the process of acquiring the correct knowledge from the right stakeholders at the right time, producing a holistic, shared understanding of the situations and complications involved from all relevant stakeholders and based on such an understanding be in a better position to make better decisions.
Making a reasoned, well thought out decision that can affect stakeholders wellbeing is dependent to a large extent on minimizing the consideration of unverified assumptions and adopting a unilateral, superficial understanding of issues. Such a decision has to be premised on the need for internalizing concerns and welfare of stakeholders involved both in the short and long term.
If this is done as a matter of routine, then such an approach to decision-making is deemed to have been integrated into the decision-making process adopted by leaders in the organization. Developing and maintaining a well-oiled and thought out knowledge management approach as a catalyst for making the right decisions is certainly a step in the right direction.
Does undertaking efforts to manage risk really make a difference? There are times I wonder whether it does. I recently conducted a project review for a construction project that was stalled due to the collapse of a portion of the roof structure. I requested for the risk register and was provided with one that was very comprehensively documented and yet this risk of the roof collapsing was not included.
Project risk management covers many aspects. One of them is the development
of a risk response strategy. Developing a risk response strategy for projects is
tedious, time consuming and laborious. It takes a toll on project managers and
project team members. It consumes a lot of time to identify, analyze and
develop risk response strategies. Despite doing this, projects still fail. Why is this
so? This article seeks to share some insights that address this question.
The results of the Brexit vote sent reverberations throughout the geopolitical and economic spectrum in the UK as well as in Europe. A referendum originally intended to silence euro sceptics within political circles turned out to be one that shook the very foundations of British politics. The Tories are leaderless, the Labour is fractured to the core and UKIP suddenly finds itself in unknown territory. Attempting to make sense of the situation will require us to confront three fundamental questions:
People want to be trusted. They want to be trusted to be able to do a good job, provide excellent service, or deliver what they promise. Trust is especially important for stakeholders, who can be anyone who contributes towards work or is affected by the outcome of work done.