Introduction
Projects—Their Importance in Business
Over recent years the discipline of project management and its fundamental approach has been accepted as an essential part of the management of business and organizations. The successful implementation of projects, therefore, is vitally important to the success of the organization and yet whereas the pressure to improve business processes and overall performance has the highest priority, projects do not seem to be accorded the same importance. The principles of continuous improvement owe much to the work of the gurus of quality and especially the seminal work of W. Edwards Deming (1986). The improvement cycle attributed to him can be modified to illustrate process improvement (Exhibit 1) such processes are often absent in projects because their organization and resourcing precludes making time and effort available either during or after the project.
The Importance of Organizational Learning
In the current global and dynamic business environment the ability of an organization to learn and thus improve is similarly critical to its success. Advancements in information technology and increased client and customer demands has meant that companies must learn from their environment and apply that learning to improve operational performance. Cross and Rieley (1999) argue that an organization’s ability to learn faster than its competitors is consequently the only true remaining source of competitive advantage.
For example, any company to compete globally they must seek new methods of innovation, efficiency and productivity. A major influence of these aspects is its ability to become a learning organization. There is no consistent definition of a learning organization, however, the following is appropriate (Nevis, DiBella, & Gould, 1995).
“The capacity or process within an organization to maintain or improve performance based on experience.”
Organizational learning can be represented by a learning cycle, which contains three elements:
•Knowledge acquisition
•Knowledge capture and dissemination
•Knowledge utilization.
Most studies of organizational learning have concentrated on the acquisition of knowledge by the creation of skills through training and development or how knowledge utilization can be integrated into new situations. This study, however, concentrates on the capture and dissemination of knowledge by examining a case study of a project based company and how they seek to achieve it. This function can be described as corporate learning. How this is applied from project to project, will ultimately affect the success of the organization.
Corporate learning can be described as: “The capability to capture knowledge and experience from previous projects and to make that information available on future projects.”
When practiced corporate learning will enable an organization to benefit from the experience of previous work to enable it to function more efficiently and effectively; and by using less resources, result in improved productivity and profitability.
Concepts of Organizational Learning
Organizational Learning
Senge (1990) in discussing the concept of organizational learning argues that to be a learning organization, an organization must practice the following five disciplines:
1. Systems Thinking—conceptual frameworks, a body of knowledge and tools that have been developed, to make patterns clearer.
2. Personal Mastery—the discipline of continually clarifying and deepening our personal vision, of focusing our energies, of developing patience, and of seeing reality objectively.
3. Mental Models—are deeply ingrained assumptions, generalizations or even pictures or images that influence how we understand the world and how we act.
4. Building Shared Vision—the capacity to hold a shared picture of the future we seek to create the goals, visions and missions that become shared throughout an organization.
5. Team Learning—the ability of a team to function at a level greater than the sum of its parts. This discipline starts with dialogue, i.e., the capacity of its members to enter into a genuine “thinking together.”
According to Senge (1990) in order to practice organizational learning, organizations must develop all five disciplines. Systems thinking is the fifth discipline as it integrates and fuses the other disciplines into a coherent body, it also encourages groups of people to look for the “big” picture.
Exhibit 1
To become a learning organization a fundamental shift or movement of mind is required. An organization must do more than take in information, it must embrace adaptive learning (the ability to learn how to survive); and generative learning (learning that enhances the ability to create).
For major projects, for example, those that involve many disciplines and numbers of people, to be a learning organization could be both very effective and differentiating. Team learning is especially important; some teams within the project may remain together for the entire duration. Even subteams within the project, which are of the same discipline, may be involved in the project for a substantial proportion of its length. However, in most cases the same team does not remain together for future projects.
Since a fresh team(s) must be assembled for each project it is important for the project-oriented organization to capture and disseminate knowledge learned from every project to as great an extent as reasonably possible.
Team learning requires an ability to deal with forces that oppose productive dialogue and discussion. These forces are often described as defensive routines (Argyris, 1992) and are evidenced by reluctance to change. The statement that “but we always do it that way” and a resistance to discover how other teams are tackling similar problems are common examples of reluctance to change.
Knowledge Management
O’Dell and Grayson (1998) defined knowledge management as: “A conscious strategy of getting the right knowledge to the right people at the right time and helping people share and put information into action in ways that strive to improve organisational performance.”
What Is Knowledge?
In order to practice knowledge management it is important to understand what knowledge is. Knowledge can be categorized into two types:
•Explicit
•Tacit.
Explicit knowledge is derived from project briefs, the WBS, design standards, books, documents, papers, databases, etc.; it can be read or written down. Tacit knowledge is less easy to define; it can be found in the memories of employees or clients. It is difficult to catalogue or document. However, both types of knowledge are important to an organization and their effective transfer is crucial.
The Barriers to Internal Transfer
The concept of knowledge transfer is a simple one; however, the barriers that prevent its occurrence are often considerable, especially in the project environment. Szulanski (1994) studied this issue and pinpointed four key barriers:
Exhibit 2
Reason 1: Ignorance. Those who have the knowledge do not realize others may find it useful. At the same time, those who could benefit from the knowledge have no idea that someone in the company already has it.
Reason 2: No absorptive capacity. Even when employees are not ignorant of the knowledge or best practice, they lack the money, time, and management resources to pursue and study it in enough detail to make it useful
Reason 3: The lack of preexisting relationships. People absorb knowledge and practice from other people that they know, respect—and often—like. If there is no established relationship of trust and confidence between two managers they are unlikely to incorporate each other’s experiences into their own work.
Reason 4: Lack of motivation. People may not perceive a clear business reason for pursuing the transfer of knowledge and best practices.
To counter the barriers to internal transfer O’Dell et al (1998) suggest that organizations must adopt a strong intention and a methodical approach to the management and transfer of knowledge.
Examples of Current Methods and Procedures Practiced Within Industry
Organizational learning applied to team learning can often focus attitudes towards reflection and dialogue. Few concepts of how to improve team learning from experience had been presented until Cross and Rieley (1999) proposed two tools to achieve this:
(a) Vision deployment matrix
(b) Learning history.
Both the above methods are applicable in a project management context and there are similarities with (a) team building techniques and (b) case study methods. The vision deployment matrix is forward looking and aims for team alignment and commitment to learning orientated behaviors. In contrast a learning history is retrospective mechanism for capturing experiences for dissemination.
Vision Deployment Matrix
The vision deployment matrix (VDM) is a method for combining shared vision and alignment with individual vision; it can also be used for creating a framework to measure progress. The VDM sets out to enable individuals to understand how they fit into a team. It tries to change the individual’s view from single to multidimensional by creating mental models and shared vision.
Learning Histories
The Organizational Learning Center of MIT developed the learning history document concept. It is a document that is created to facilitate the sharing of experiences and to enable the organization to become aware of learning. The document is compiled by an individual—a learning consultant (a third party not involved in the original project) who interviews the participants, e.g., project manager, team leaders, etc. The learning consultant should work within the framework of Senge’s (1990) five disciplines and particularly should employ systems thinking.
Learning From Projects
Theory vs. Practice
Many organizations have well formulated procedures for reviewing projects throughout their life cycle. Some of the standard project management methods also include processes for data capture during and after the project (e.g., PMI, 1996). However, many years of project experience have shown these processes to be either superficial or poorly applied. These are the most common reasons for limited appraisal:
•It requires time to carry out appraisals—often limited in schedule driven projects.
•It also requires effort and therefore cost; in many cases lack of budget for such activities preclude them being carried out.
•The major appraisal is generally reserved for the end of the project, by which time most of the people who worked on it have either left the project and are difficult to extract from their current assignment.
Models, Processes and Enablers
Model for Best Practice Transfer
The model chosen to analyze the company in the case study is an adaptation of O’Dell et al’s (1998) model for best practice transfer. It has been adapted to reflect the deliverable focused nature of a project-orientated organization utilizing the skills of individuals to function as a team (see Exhibit 2).
At the center of the model is the target—corporate learning. The adapted model has four key enablers:
•SYSTEMS (Infrastructure)[methods and procedures]
•Culture and Environment
•Systems (Technology)
•Metrics (Measures).
The Target: Corporate Learning
Although corporate learning has already been defined earlier it is worth considering here in a broader sense as a process aimed at:
•Understanding client’s expectations so that alignment occurs
•The delivery of a service that produces a quality product
•The achievement of consistency and excellence from project to project.
All of these objectives are achieved through learning that is captured and disseminated and facilitated via four levers or enablers that create and sustain the learning environment.
Capturing and Disseminating Knowledge
SYSTEMS (Methods and Procedures)
SYSTEMS are the explicit and institutionalized organizational structure that assists the transfer of knowledge through transfer specific mechanisms. SYSTEMS resolve into two main types:
•Infrastructure
•Superstructure.
Infrastructure
These are specific practices that facilitate the capture, recording and transfer of knowledge. Examples of these practices are reports or regular meetings, which try and spread lessons learned to others.
Infrastructures may be categorized as follows:
i. Self-directed—The self-directed approach requires individuals to use their initiative to find the information required. This system usually uses “pointers” that do not deliver the information required to the individual but provides a guide to a likely source of the information often via databases or document vaults.
ii. Knowledge services and networks—This approach to designing infrastructures goes further than the self-directed method. It provides knowledge management services and organized networks together with self-directed components. The services and networks scan the available information and consolidate it into more a manageable format; the services may be in the form of Coordinators or Gatekeepers. These Gatekeepers are individuals that may be on the periphery of the process but still facilitate or allow processes to function.
iii. Facilitated transfer—This approach provides specific individuals to assist and encourage knowledge transfer. These individuals may be change agents, i.e., third parties who, are either external or internal to an organization and provide objective views and take specific actions to allow processes to occur. They are trained to assist individuals with:
(a) Finding, capturing and transmitting knowledge
(b) Helping to solve specific problems
(c) Act as internal consultants to facilitate implementation.
Superstructure
This approach involves appointing a knowledge management champion to co-ordinate and direct knowledge transfer. These appointments are often titled Knowledge Officers or Learning Officers; they are can be located at corporate level but business unit level is often more appropriate.
Culture and Environment
The culture of an organization is difficult to define, as it is not specifically recorded in documentation. It is convenient, however, to consider the culture of an organization in three layers: the values, the beliefs and the taken-for-granted assumptions of an organization that make up the paradigm. These are usually evident in the day-to-day discussions or behaviors of people. To understand the paradigm and the nature of an organization Johnson and Scholes (1997) devised the cultural web that breaks down the organization into six elements:
•Stories
•Symbols
•Routines and rituals
•Power structures
•Organizational structures
•Control systems.
Using these elements it is possible to depict the culture of the organization as a set of interlocking domains.
Systems
It is no coincidence that knowledge management has blossomed when so has information technology (IT). As desktop PCs have provided access to information in the form of easy-to-use personal and shared databases this has driven people to seek more information.
It is important that systems such as the Internet, intranets, databases and document vaults make connections possible but not inevitable. Such systems are not a guarantee that knowledge transfer will occur and information overload must be avoided.
Metrics
Measuring the benefits of corporate learning to an organization is highly subjective as the choices of how and what to measure are themselves subjective. There are three commonly suggested methods of measuring the benefits of corporate learning:
•Share value
•Performance improvement
•Cost of not knowing (CONK).
Case Study
The company studied executes a wide variety of projects over a number of sectors and so have a diverse and interesting experience set. They are based in the U.K. with associate offices in North America and elsewhere.
A Framework for Analysis
The model described above was used as the framework for the analysis. Using a structured questionnaire, 17 people were interviewed; sampled across the management levels of the organization. The responses were analyzed to identify the extent and application of the four enablers of the model (see below) and then an implementation model was developed for increased Corporate Learning.
Mechanisms for Knowledge Transfer
The following subsections describe the existing situation.
Existing SYSTEMS
The organization currently relies on three types of SYSTEMS:
•Closeout reports
•Departmental meetings
•Project workshops.
These SYSTEMS are practiced to try and capture knowledge and experience and to disseminate that knowledge and experience to other parts of the organization.
Closeout Reports
These are a requirement of all projects and follow the set company. This procedure offers the opportunity for team leaders to comment on good and bad aspects of the project and for these comments to be aired with senior managers at the close out meeting. Any actions that arise at this meeting are given to heads of department to resolve and the reports are then stored for future referral by other parties.
During the interviews, however, it became apparent that although closeout reports are produced and closeout meetings held the system does not function as intended. The main concerns relate to the fact that the reports are produced and then subsequently neither circulated nor made accessible to others. Any lessons learned—good or bad —are passed to the heads of department who disseminate those lessons via department meetings or other informal processes.
Departmental Meetings
Typically the senior engineers from a group or discipline meet regularly to discuss issues, e.g., lessons learned. From the interviews, however, it was evident that not all departments hold such meetings on a regular basis and, therefore, further opportunities for corporate learning are lost.
Project Workshops
These are held at the beginning of most projects to discuss ideas and to formulate the project’s execution strategy. These workshops are not fully effective because the people with the relevant knowledge or experience do not always attend. This is due to two factors:
i. Project managers do not know who has the relevant experience
ii. Project managers are concerned about consuming work-hours by inviting people to attend who need not be present.
Existing Culture and Environment
The cultural web model (Johnson & Scholes, 1997) has been applied to the organization in order to determine its values, beliefs and its paradigm (its cultural nature). The organization is locked in a belief that it cannot afford to expend resources on its personnel’s experiences and knowledge. The paradigms “time is money” and “innovation and excellence” militate against an environment where corporate learning may prosper.
Existing Systems (IS/IT)
The organization is currently introducing systems that will provide IT support for corporate learning. These are:
•A document vault—a proprietary document management system
•A skills database—developed internally.
Document Vault
This is an environment for storing all manner of electronic documents in a variety of formats, e.g., word processing, spreadsheets, and design data files. It contains a powerful search engine that will search all of the files for any data that is required. This system is intended to provide the cornerstone of the organization’s corporate learning for the foreseeable future.
Skills Database
This was introduced in the autumn of 1998, and is the organization’s human resources database. It contains data from people in a number of divisions concerning their project experience and backgrounds and may be interrogated for information on who knows what across the organization.
Existing Metrics
These would appear to be minimal, as there is little evidence to suggest that any measurement is made except for comparisons of the number of work-hours taken to produce a deliverable at the end of each project. Heads of department subsequently uses this information for estimating.
The metrics are insufficient to measure the application of corporate learning. Consequently, a broader form of measurement is required to do this.
Analysis Summary
Of the four enablers only (IS/IT) systems appears to provide a satisfactory mechanism for practicing corporate learning. Of the remaining enablers SYSTEMS requires the better application of existing and the introduction of new methods. The existing culture does not foster corporate learning and the introduction of suitable metrics is required.
Formulating Improved Learning Systems
The Desired Target
The four enablers therefore need to be balanced out if the organization’s aim is to become a learning organization. In order for this aim to become part of the shared vision of the organization it must be communicated to the workforce so that it is understood and appreciated. A suitable vehicle for this would be via a mission statement or “leading by doing” from senior management.
The following suggested steps would enable the company to fulfill the aim of achieving organizational learning and to practice corporate learning in a project environment.
Desired SYSTEMS
Current SYSTEMS would be improved by implementing existing procedures and introducing other complimentary procedures.
Closeout Reports
The content of the reports should be reformatted to produce a more effective output by adopting the learning histories approach. In addition the accessibility and the cycle time of these reports must be improved.
Departmental Meetings
Departmental meetings are a vital method of disseminating information. They should provide a coordinating service where the head of department acts as a critical link (“gatekeeper”) between the technology group and the project. In addition departmental meetings enable individuals to network with other group or department members and share knowledge.
Other SYSTEMS
Other suggestions made during the interviews were as follows:
•Use notice boards to publicly announce lessons learned from projects.
•Hold lunchtime meetings to present formal lectures or discussions on lessons learned.
•Make a critical checklist of common mistakes made on projects or processes available.
Superstructure
An individual should be appointed to oversee the coordination and direction of knowledge transfer. This individual or Knowledge Officer would be responsible for implementing a corporate learning program and overseeing it. The individual’s remit would include all four environment enablers.
Desired Culture and Environment
In order to foster and encourage an environment where a culture of corporate learning exists O’Dell recommends that there are six steps that can be taken:
•Believe people want to share
•Prepare to lead by doing
•Capitalism and democracy
•Develop collaborative relationships
•Instill personal responsibility for knowledge creation and sharing
•Create a collective sense of purpose.
For a culture that will support corporate learning the paradigm must change from “time is money” to “knowledge is common.” The paradigm “innovation and excellence” may remain as this is not only consonant with “knowledge is common” but because it is vital that the organization continues to produce high quality output.
Measuring the Results
Metrics are required to ascertain the effects of the other enablers. Performance improvement indicators are the most suitable metrics.
Implementation Issues
Conclusions for Transition
Comparison of the existing and the desired states indicates significant difference between them. If the organization wishes to become a learning organization via corporate learning it needs to address the current barriers to change.
The barriers that prevent change exist within the current SYSTEMS and culture. The role of a Knowledge Officer is seen as a key appointment to coordinate and direct knowledge transfer. This individual will need the support and backing of senior management, for the role not to be undermined.
Revised closeout reports with learning histories would be an important step. The learning histories could be managed by the Knowledge Officer.
To change the paradigm of “time is money” to “knowledge is common,” a top-down approach is required from senior management. A demonstration of commitment to corporate learning via strict implementation, by introduction on pilot (prototype) projects, and measurement of corporate learning during the staff appraisal will cause the culture to change.
Implementation
Finally the organization should implement the transfer system in a structured process of:
i. Plan—where are we? Where do we want to go?
ii. Design—outline the roles and functions of the people and technologies
iii. Implement—usually via a pilot program that will prove the concept
iv. Scale-up—apply the pilot to become business-wide to capture the full benefits of transfer
This provides a step-by-step project approach that could be managed by the proposed Knowledge Officer.