A little knowledge may be a dangerous thing, but it’s all the rage in management these days. Making sure people within the organisation know what they need to know, when they need to know it, is now seen as a key management job.
That’s a challenge in any company, but particularly one where operations are widely separated by geography and perhaps also by culture and by level of development.
The huge base of technical knowledge you have in your headquarters may not be matched by that small start-up office out in the Middle East. And if you’ve recently acquired a business in formerly Communist Eastern Europe, the understanding you have of how to do business in a free market may be something new to your employees there.
Information flows within an organisation like blood in the human body. Generally, it has three ways of flowing — across (from division to division, or team to team, at the same level); down (from senior management to the shop floor); and up (from customer-facing or operational teams to their managers, and so on).
But if your blood only flowed in one direction in your body, you’d be dead. So it’s important to make sure that knowledge is passed on at all levels and in all directions.
Let’s have a closer look at these three types of information flows.
Down
Information moving down, from the board of directors to the shop floor, is the traditional picture that most people have of a business. It’s important to realise that it’s not the only model. If you depend on this model, you are — in the end — depending on only five or six people in the whole organisation. Do you really think your senior manager knows everything? About every customer? About every product? About everything that’s going on? (And even if you do, do you think your senior manager has the time to do anything about it all?)
If, on the other hand, you promote flows of information across and upwards, you are using all the knowledge available to you, from everyone in the organisation.
Of course, downwards communication has its uses.
It’s excellent for introducing new processes, new strategies, new products. Often, only the senior management in a company can see the whole picture — other staff are too much involved with single functions or locations. Downwards communication is often very quick and it ensures that the same message is getting through to everyone, so it’s particularly useful for strategic, top-level issues.
Across
On the other hand, knowledge flowing across the organisation is much more useful for the nitty-gritty of business life. People who work at the same level will tend to share information that makes their lives easier — whether that’s a new technique for using materials, or a customer contact list. Sometimes, it’s just knowing who deals with what product, or who within the organisation is an expert on what.
Knowledge that flows across the organisation tends to cross divisional lines. That’s counter-cultural in many companies, so the first necessary step is ensuring that the ‘functional stovepipe’ (where issues are always escalated to a senior manager) doesn’t happen.
Encourage staff to speak to their counterparts in other parts of the organisation. Encourage them to solve issues on their own initiative. Encourage managers to delegate properly.
If you don’t transfer knowledge across the organisation, customers tend to notice. They place an order and when they ring to check on progress, no one knows what is happening; the accounts department bills them the wrong amount; the maintenance team turns up at the wrong address. Or there’s a new product with a massive advertising campaign — but customers can’t buy it, because accounts haven’t given it a product code and nobody told the sales team that it’s available.
One of the simplest ways to ensure knowledge is transferred around the organisation is to get people in different areas to meet each other and to work with each other on common projects. There are a number of ways to do this. Task forces and project teams can provide a good arena for staff to learn about their place in the organisation and to see other divisions’ work practices at first hand, while achieving a solid business aim at the same time.
Secondments also provide a means for knowledge to be shared. Sending an experienced member of staff to work in a start-up business, for instance, is often a good idea — that person probably knows as much, informally, about the business as a whole, as about their own particular speciality.
Information moving across the organisation is particularly potent because it captures so much informal knowledge — the things everybody knows, but no one will ever tell you. And, of course, because the participants are of broadly equal status, it’s ‘share and share alike’, while many staff would be unwilling to admit to their bosses that they need help understanding an issue.
Up
Now, this is revolutionary, to some managers. Knowledge can move up an organisation, too. But management attitudes are often unhelpful; as one director of a company said to me, “I listen to my staff, but I don’t do what they tell me.”
It’s often the people at the bottom of the organisational chart who deal every day with customers. Yet organisations that spend a fortune on market research and attitude surveys often neglect the knowledge that these staff have of their customers. Doesn’t it make sense to listen to what they have to say?
Besides, market research often tells you what you needed to know six months ago. If you ask the sales reps, you may find things out more quickly. For instance, if customers are scaling back their orders or deserting you for a competitor, you will find out first from the sales reps.
Apart from status consciousness, there’s another factor that impedes upwards flows of information. It’s called ‘shooting the messenger’. If the cleaning team rep has bad news, he’ll probably try to cover it up when he reports to the facilities manager. In her turn, when she reports to the board, she’ll try not to mention it. Because of this, the first time the board hear the bad news is when the finance director tells them they’re losing money.
Perhaps the most extreme example of this kind of behaviour is the Japanese bank that lost billions because one of its traders couldn’t own up to a mistake — a mistake that would only have cost them a few thousand pounds. Make sure that people feel able to pass on bad news as well as good news on to their managers.
The ideal company would have a thousand employees who all knew everything about the business. Well, you can’t achieve that — but maybe you can at least make sure that the employees all have access to that knowledge through someone else. “I can’t — but I know a man who can” should be your motto.
Information is the lifeblood of business. Make sure that you keep it circulating.
