On Excellence: Teaching employees to talk up profits

SOME call Asea Brown Boveri, the European heavy industrial firm, the most decentralised large company in the world. Its dollars 30bn in revenue springs from 1,200 companies, averaging 200 people each. Consider its power transformer business: at dollars 1bn it is four times the size of its next biggest rival, but these proceeds come from 25 factories in 16 countries - and on average these are smaller than their largest local competitor.

'We are not a global business,' insisted Sune Karlsson, the chief executive. 'We are a collection of local businesses, with intense global co-ordination. This makes us unique.'

But how do you exercise global co-ordination to add value among autonomous enterprises? 'Our people work on the same problems day after day, year after year, and learn a tremendous amount. We want to create a process of continuous transfer of expertise. If we can do so, that's a source of advantage none of our rivals can match,' Karlsson said. The 'if' is the billion-dollar question. The answer is to create the much ballyhooed but little understood 'learning organisation'.

Buckman Labs, a speciality chemical company based in Memphis, Tennessee, with annual revenue of dollars 200m, has a market value that exceeds its hard-asset value by dollars 175m. Bob Buckman suspects that value comes from the employee knowledge that is knocking around in the system.

Pondering those figures led Buckman to an obsession with '520 connected brains available to work on any problem'. He juiced up spending on information technology, and in mid-1992 shifted all information activities to an aptly titled knowledge transfer department. Buckman makes it clear that only those who get with the new programme will succeed. 'The most powerful individuals in the future of Buckman Labs,' he said, 'will be those that do the best job of transferring knowledge to others.'

Echoing these ideas, journalist Alan Webber claims the profound shift towards a brain-based economy means re-conceiving work 'as conversation'. Time was, he wrote in the Harvard Business Review earlier this year, 'if the boss caught you talking on the phone or hanging around the water cooler, he would have said: 'Stop talking and get to work.' Today if you're not talking with colleagues and customers, chances are you'll hear: 'Start talking and get to work]' In the new economy, conversations are the way knowledge workers discover what they know, share it with their colleagues and, in the process, create new knowledge for the organisation.'

Brook Manville, director of knowledge management at McKinsey & Co, the consulting firm, is trying to get several thousand dispersed consultants, always on the run, to learn more effectively from one another. Webber suggests Manville might better be called 'director of conversation' or 'internal talk-show host'.

One surprising candidate to fill this new corporate role is Michel Bauwens, an information systems manager at British Petroleum. He says information in corporate libraries usually belongs to the 'nice to know' rather than 'critical to survival' category.

Moreover, he adds, many companies have decided 'information is not a core competence but something that can be carried out, cheaper and in a more efficient manner, by outside information brokers'. At BP, for example, the central business intelligence unit was cut from 15 people to one. Yet Bauwens has no axe to grind: 'It is not my intention to blame anyone, but to point out that the fault may be in an outmoded organisational model that finds its expression in the existence of a central corporate library.'

In what he calls his 'cybrarian's manifesto', Bauwens argues that the library should become 'client-centred . . . cutting through the hierarchy and developing direct contacts in a networking model . . . consisting not only of external databases but also of E-mail, bulletin boards and computer conference systems'. Location counts as much as bits and bytes: 'Instead of huddling together among colleagues in a central location, we should be working in ad hoc teams closely integrated into the corporate fabric.' Add it up, Bauwens writes, and 'the corporation serious about its information needs may (need) a network of cybrarians - ie, librarians able to navigate in 'cyberspace' - strategically located through the company'.

I must admit that 'librarian' brings to mind Miss Pinkins, a spinster with grey hair pinned up in a bun. I'm not sure I've actually ever met such a person, but the image lingers. But the new library- cybrary function, the role of talk-show host, and the activity of knowledge-transfer are guickly becoming central to corporate strategy. The issue is of prime importance. As Karlsson, Buckman, Manville, Bauwens and all too few others know, the first to get this building block in place will have a matchless advantage in tomorrow's marketplace.

Copyright TPG Communications