Since Peter Drucker wrote The Practice of Management, published in 1954, the challenge of management has undergone considerable change. Management is re-characterized by Drucker in his more recent book, Post-Capitalist Society (1993), as “the systemic and purposeful application of specialized knowledge resources for maximum attainable performance and productivity.”

These knowledge resources are not simply secondary sources of information or ideas, however; they are people who possess specialized and advanced knowledge that is capable of producing economic results. In fact, it is the work performed by these specialists—whether creating knowledge (knowledge work) or applying knowledge (service work)—that is now of greatest importance to management. For many industries today, and particularly for those whose operations depend on the work of professionals or providing services, it is these people, not machines, who are now the means of production.

Untapped Opportunity

Most managers were educated and trained on methods of work design and management conceived at a time when people were viewed only as a source of labor to operate a company’s processes or to do work that is tightly directed by management. For these managers to manage knowledge-based operations, the practice of management must change. To manage this new work effectively, managers can no longer command and control their organization; they must learn how to facilitate and support the individual achievement of maximum value creation. No longer are these workers simply supporting the production capacity. Today, the organization is the production capacity. These knowledge workers are now management’s source of knowledge about customers, markets, competitors and professional practices, and its principal transformer of knowledge into value for customers.

New Knowledge for Knowledge Management

Today’s principal knowledge-management challenge is to design human work and organizations so that people can maximize their creation and application of knowledge, thus creating the greatest possible value for the enterprise. Many of today’s managers are unskilled in work and organization design and unfamiliar with the professional-level knowledge that is available to meet their challenge.

We generally find that the more effective organizations have less than 25 percent of their knowledge and service workers operating at what you would call “high-performance.” And rarely is this level of performance the result of insufficient information for performing their function. The problem is not that IT has failed to provide easy access to what these people need in order to do their work. Rather, this performance shortfall stems from unattended issues such as the design of roles and work systems, misaligned managerial systems, poor fit of the worker with the role, and so on. Essentially these are issues that are simply missed because no one involved has the professional knowledge or responsibility to assure that these issues are supporting the operational objectives.

Frontier of New Opportunity

Providing this necessary attention to the design of human work systems is a substantial frontier of new opportunity for achieving improved results in knowledge management initiatives. Knowledge- and service-workers inevitably perform well below their potential because the design of processes and the roles and tasks within them do not receive design input from professionals that truly understand human behavior. This omission also explains why management finds itself so challenged when seeking to assimilate tacit knowledge held by current workers and when trying to engage these same workers to utilize knowledge distilled by their peers. In actuality, these challenges are easily met.

pepitoneworldwide is routinely sought after to educate industry and government executives on the valuable knowledge and insights we have gained from our development and application of humaneering technology. What these executives learn, like the in-depth knowledge of any subject, often runs contrary to conventional wisdom and the “fads and fashions” in management.

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