I3 UPDATE / ENTOVATION International News
No. 21: July 1998
Contents
Are You Being Served? - David J. Skyrme
The Search for New Knowledge Standards (in Finland)
- Debra M. Amidon
Y2K Bulletin: The Fear of Panic - Jan Wyllie
Resources
Events
Snippets
Editorial
Welcome to this edition of I3 UPDATE / ENTOVATION International News, a free briefing analysing developments and key issues in the networked
knowledge economy. This month there are features on customer knowledge and
service, and of a recent conference in Finland, always an interesting bellweather country of how management trends unfold. Also on trends, Trend Monitor's ongoing analysis of the Y2K problem continues - the news seems to get worse as time ticks away.
I3 UPDATE is also available by email. See the administrative information page.
David J. Skyrme
Managing Editor
David J. Skyrme
Customer knowledge invariably comes out top in surveys as a company's most
vital knowledge. My colleague Debra Amidon spelt out the distinction
between knowledge of customers and customer knowledge in a recent I3 UPDATE (No 18 - April 1998). However, this knowledge is of little value if not converted into a business benefit such as better customer service.
Good Customer Service is Knowingly Appreciated
When you experience good customer service, you really appreciate it. I buy
my business stationery and office supplies from an organization a long way
from my workplace. In fact, it is based in the city that claims to be the
centre of England - Leicester - clearly good for distribution. I can place
an order at up to 8 o'clock in the evening and get next day delivery.
Prices are lower than suppliers in my home town, and service is excellent.
Only once in many years did part of an order go wrong, and a replacement
was on its way, no questions asked, the same day. The supplier remembers
what I have bought and sends occasional reminders with special offers
unique to me e.g. "You last ordered fax rolls on 21st March. Your special
price for this item is XXX." It even sent me a gift on my fifth
anniversary of trading with them. In other words, not only do they know my
buying habits, they have products, prices and service to match.
More Often Than Not...
In contrast to the above example, which relates to tangible goods, you
might expect that for intangible services and through use of technology,
service should be even better and faster - wrong! Two of Britain's leading
banks have egg on their face this week. 400 ATM terminals at NatWest went
out of action - you simply could not get access to your own bank account or
withdraw cash. Apparently, it did a system upgrade over the previous
weekend, but ran into trouble with its new client server application.
Barclays, like many others, are offering banking by phone: "call at any
time, and do all your transactions from the convenience of your home".
However, as many of their customers discovered, it is not so convenient
when all you get is the busy tone. A spokesman from Barclays in a radio
interview added insult to injury when he said that the problems were
because it was too successful in attracting customers!
My own recent dealings with utility and financial service companies
associated with our move (see details at the end), indicate the growing
demise of customer service through inappropriate voice response technology.
Several services made me wade through three layers of options of 4-5 items
in each. Couldn't a telephone operator route me quicker?
These are examples of where technology, rather than improving customer
service, has actually harmed it. And all this before Y2K problems start to
hit! (See Jan Wyllie's Bulletin below).
Served by the Web?
Every day we read about the benefits of electronic commerce. A typical
banking transaction costs over a dollar when done by conventional methods,
yet only cents over the web. However, as suppliers like Amazon.com have
shown, the real benefits come not just through reducing transaction costs
but by increasing your knowledge of customers and focusing offers to them.
When an author publishes a new book, interested customers are notified by
email of the new title. Through technology the customer relationship is
deepened.
Figures cited by analysts for the value of electronic commerce are mind
blowing - quadrupling every year to exceed $1 billion by 2000 is not
untypical (though we need to remember that this is still less than 5 per
cent of retail sales). But for every Amazon.com that uses the new media
effectively, there are many who do not. For their potential customers it is
an ordeal to find any useful information yet alone place an order. One
recent survey showed that only a third of companies gave meaningful
information and less than 20 per cent allowed you to place an order. It
almost seems that the bigger the company, the less the information and the
longer the wait to find that what is there.
Several times recently, I have tried to conduct online transactions without
success. In several of them, after 3-4 clicks you finally got to what you
thought would be the page with product and pricing information... then were
given a phone number to call (and not a 24 hour one at that). This defeated
the purpose for me - trying to use my time more efficiently by placing
orders in the evening. Another corporate home page loads Java, followed by
about 110K of information - quite a long wait. Even more annoying is one
home page that insists you load Shockwave, so as to view their graphics
wizardry. Now I've nothing against Shockwave - if your product is
multimedia and you need to see it to its full effect. But not for what I
was trying to view, and certainly not without having any alternative work
around. Insisting that customers go and download another plug-in seems a
very effective way to put them off. I did come back to that site later when
I had more time. But then I found the Shockwave page rather off putting -
it looked like a major software installation to me, with all the problems
one might expect if it does not go smoothly. So sorry, XYZ, I still have to
get past your home page.
Not All Bad News
Yes, corporate webmasters are still trying to show off all their gizmos,
rather than getting down to fundamentals e.g. giving fast routes to
information and engaging potential customers in knowledge exchange and a
deepening relationship. But compared to matters when I did a survey a year
ago, there are two significant improvements:
First, News and information services. As well as the Push technology
channels (e.g. Pointcast or Backweb), serious news and information
providers are steadily improving their offerings. My own current favourite
is NewsPage (http://www.newspage.com) that offers a
degree of personalization. It also has a category on knowledge management, so I set that as my default home page, and get the day's knowledge management news
every time I use the Web (unfortunately, 90 per cent of knowledge
management news is only about technology - if you don't believe me, look at
the news section in the June edition of Knowledge Management - 10 out of 12
stories are IT related. One of the two that isn't is on a "new survey" from
Ernst and Young, which seems to be the survey done jointly with Business
Intelligence in late 1996 and published in Creating the Knowledge-based
Business over a year ago! The other item of non IT news is another survey
with the headline "Culture, not IT, the barrier to success of KM
initiatives, says IBM report" - call that NEWS?). So please, is there any
non-IT KM news??
The other significant improvement is that many corporate web sites do now
respond to their email. When I did a survey a year ago, I got only a 40 per
cent response and only 15 per cent from knowledgeable people; normally the
webmaster or a junior clerk was fielded to handle email enquiries. Today,
the response rate seems closer to 75 per cent (though I haven't done a
similar systematic survey). From two recent enquiries, I actually received
product literature in the post the very next day i.e. these suppliers
really are treating the Internet as a serious marketing channel.
Additionally, there is general progress on companies trying to use the
medium more strategically. The business sites of Dell (with build and price
your own computer and Internet-only special offers) and American Airlines
(complete with flight arrival times) are good examples. With developments
in electronic payment mechanisms, and the increasing ease of creating web
pages linked to databases, it is hoped that we really will see some
significant improvements in customer-centric web sites in the near future.
10 Ways to serve Your Customer Better (with an emphasis on the Internet)
1. Listen - every conversation reveals more of their needs. Are you
capturing this knowledge? Many telesales people who call me definitely do not.
2. Share that knowledge - is feedback to customer service, or telesales
come that, held on a database for subsequent sharing? (obviously within any
legal constraints of holding personal data).
3. Know where your customers congregate - attend their events; make sure
you have links on relevant web pages, often resource directories or
publications (e.g. http://www.truckworld.com for truckers
http://www.quicken.com (US) or http://www.moneyworld.co.uk for
financial information.)
4. Make your Web site crisp and clean - even in today's graphics
intensive world, sites like Commercenet (http://www.commerce.net) are simple but
effective. In contrast, Philips (http://www.philips.com) takes a while
between the images to figure out what is there.
5. Make it easy for visitors to find their way around - on websites, use
navigation tools that are easy to find. Xerox (http://www.xerox.com) has a
text menu bar at the top (so it always comes up first) and a search tool.
On the phone make sure your receptionist knows where to point the potential
customer more intelligently than most voice response systems do.
6. Be informative - it is not just your products visitors want to know
about. Give them white papers, application notes, case studies, links and
resources. Marshall Industries, (http://www.marshall.com) for example,
does most of this and also serves visitors with industry news, details of
events, useful links etc.
7. Engage in dialogue - OK let people fill in a form for marketing
purposes, but don't ask too much too soon. On Internet forms, show which
fields are mandatory and keep them to a minimum (2 or 3) for first time
arrivals. Keep up the dialogue e.g. through regular emails, or as at
Amazon.com (http://www.amazon.com) according to specified interests.
8. Guide people to the choice that is right for them - this is what good
dialogue with a salesperson achieves, so you have to offer viable Internet
alternatives. Xerox uses Saqqara (http://www.saqqara.com) to guide users to
appropriate products. Marshall's (http://www.marshall.com) goes one
better.As well as its Interactive Selection Guides it has a 24-hour chat line on
its web site (Help@Once) where you can 'talk' to a technical support
engineer.
9. Offer multiple routes for ordering - on the Internet, don't
force people to go to the phone; let them order, even if they have to print out and fax
an order form. On the other hand, give a phone alternative. Even when they
have ordered by phone, let them check the progress of their order c.f.
FedEx (http://www.fedex.com)
10. Make support easy to obtain - no more busy help lines please with
excruciating music when on hold (presumably to make you put the phone
down!). Provide an ability to feed back problems out of hours e.g. on
answerphone or even better via email.
In all of these activities, you are capturing knowledge (especially if you
run a focus group of consumers using your web site). Perhaps the most
important way to service your customer better is to make sure you capture
that knowledge and use it to good effect in better products and services,
by refining it and pushing it around your organization.
And Five Big Don'ts
1. DON'T use technology gizmos for technology sake (frames, Java,
Shockwave
etc.). Make sure you can address 95 per cent plus of Internet users (e.g.
Commercenet will work with Version 2 Netscape and Internet Explorer
browsers - will yours?)
2. DON'T misuse frames. Some of the worst sites have clumsy frames
that cut up the screen into too small segments and don't give non frames alternatives.
3. DON'T relegate dialogue to an afterthought. Provide response
forms and allow targeted email replies from different pages. Don't let users wait 5
days for a reply, or leave any sales enquiries to a webmaster rather than a
trained response team.
4. DON'T omit basic details e.g. of how to get in touch - office
locations, addresses, phone and fax numbers (it's amazing on how many sites you have to work hard to track these down). It is also useful to put the page URL
and revision date on every page.
5. DON'T ignore the needs of your users - they want information that is
easy to find, accurate and up to date, with pointers to additional help,
including real people.
David J. Skyrme
email: david@skyrme.com
Debra M. Amidon
In May, Esko Kilpi of Sedecon Consulting organized two major events in
Helsinki, creating a national dialogue. In his opening remarks, he outlined
new frontiers of knowledge management:
- theory of organizing, power and governance
- contrast of authoritarian and democratic power
- the power of purpose
- management accountable for the flow of ideas, not any one owner or
group of people
With the formula
Capital = Community + Creativity
he suggest that the heart of the movement is actually a function of the
flow of meaning. The challenge then is to connect people in a meaningful
way and enhance their capacity to transform information into invention and
initiative.
Using the Hamel/Prahaled chart (customer needs met/unmet), he argues that
it requires an understanding of unarticulated needs, to serve the new needs
of customers: "If acompany wants to see its future, 80 per cent of what it
is going to have to learn will come from outside of its own industry.
Connectivity is the focus. The thicker the networks - including partners,
customers and other stakeholders - the richer the knowledge."
In presentations for the Ministry of Education in a conference "Knowledge
Management and Knowledge Productivity in Contemporary Society and
Organizations", useful insights were provided by various experts, including
Rob van der Speck (Cibit), Lilly Evans (Global Learning Web), Annikki
Jarvinen (University of Helsinki), Seija Kulki (Helsinki School of
Economics) and Debra M. Amidon (ENTOVATION).
The key messages can be summarized according to a management architecture:
I PERFORMANCE has become a balance of tangible and intangible
assets. The
investment/return equation has been challenged. It is far more a matter of
linking human potential and economic value. Incentives need to reward
knowledge-sharing and resources allocated for the long term.
II STRUCTURES represent connection - clusters of knowledge,
communities of practice. We are beginning to observe fields of knowledge-creation both personally and professionally. Through multiple relationships, things are
happening.
III Real value lies within the INDIVIDUAL. It is a matter of becoming a
better practitioner, not a matter of best practice. Cognitive processing
has shifted from serial to parallel causing quantum breakthrough impacts.
We rely on the individual for the capacity to innovate.
IV The PROCESS is one of innovation - idea creation through
commercialization. At its core is participation, interaction and
interdependence. The context is the international marketplace and a variety
of cultures which value these and bridge and build interfaces.
V The TECHNOLOGY - an integral enabling factor - shifts from
information to knowledge processing. Communications requires an externalization of
knowledge - both human and technical, which takes the form of groupware,
Intranets and the Internet - leading towards a global innovation
infrastructure.
In summarizing the conference, Finland's Minister captured the key themes
that echoed throughout the day:
- The need for 'context'
- The half life of knowledge
- The importance of meaning and purpose
- The difference between "have to" and "want to"
- The relationship between knowledge management and life-long learning
- The value of participatory innovation
- The multi-dimensionality of the topic.
He suggested follow-up activity which would include training of the public
sector, a focus on dissemination and diffusion, continued international
discussion, and further elaboration of ideas.
Debra M. Amidon
Email: debra@entovation.com
Trend Monitor International Monthly Bulletin (July)
Jan Wyllie
Now that it is virtually certain that grave consequences will flow from the
Y2K "timebomb", the most pressing issue which must be faced is what and how
much should the public know. There is concern in government and industry to
prevent "chaos mongering" from causing "public panic". This concern among
businessmen and politicians in the face of an ignorant and helpless public
is understandable, although it is no doubt also combined with a natural
human tendency not to expose their own failings.
Sadly, it is not surprising that the techniques employed in the name of
"panic reduction" are the same as traditionally used by any group trying to
defend the indefensible, that is, to discredit the messengers and impugn
their motives, rather than deal with the facts of the matter. For example,
reliable sources are saying that a prominent Y2K spokesman in the UK is the
target of an orchestrated campaign.
Trend Monitor's last Y2K Bulletin (June 20, 1998), on indications of the
growing disparity between the official message / public view of the
phenomenon and the view of people who really know, was itself accused of
self-seeking panic mongering by no less a personage than Anthony Judge,
http://www.uia.org/, the man responsible
for compiling the Encyclopaedia of World Problems and Human Potential. In his critique, he discredits the motivation of the "panic mongers" by dividing them into the following types:
- computer people "taking advantage of the situation"
- constituencies "who want people to get all stirred up for any reason"
- those who are "into end times scenarios / apocalypse etc."
- "alienated" people and groups "who have a special psychological need
to have a major benchmark and focus in their lives"
- constituencies who "recognise that humanity needs invading Martians".
There may be some of these kinds of individuals around, but I must say that
all the people I know who are the most concerned because they are the most
knowledgeable, do not fit the descriptions on which Mr. Judge's
personalised, ad hominem "arguments" are based. The software engineers,
journalists, members of think tanks, academics and self-made experts of
whom I aware are fearful and frustrated, not for any of Mr. Judge's
reasons, but because of the overwhelming body of evidence pointing towards
some kind of systemic breakdown. Most have been watching in increasing
horror for more than two years as the story of procrastination, denial,
mismanagement and irresponsibility unfolds. They are desperate to push the
message out, so that people have time at least to take some contingency
measures before it is too late.
As for the panic scenario, I can report an interesting development. An
increasing number of Y2K-savvy people are beginning to move beyond the
"frozen in panic" stage. They are now beginning to conceive of the crisis
in a different light, not as an insoluble problem, but as an opportunity to
create a more sustainable way of living in an economic system where people
are more self-reliant, rather than being so dependent on giga-scale
computerised infrastructures. Don't take my word for it. Three excellent
examples of this kind of emergent thinking are papers by John L Petersen,
http://www.arlinst.org, Douglass Carmichael, http://tmn.com/~doug and Larry
Victor,
http://www.azstarnet.com/~nuu/Y2K/Y2K_A&R_WEB.htm.
People typically move from denial to panic to action. Some panic may be
unavoidable. Still, contingency action involving social and economic
prioritisation (triage) informed by a spirit of opportunity and trust,
rather than the policies based on deception and secrecy, is the practical
antidote to panic.
"Shooting the messengers" and trying to pretend that it can be business as
usual and that the authorities know best is the perfect recipe for real
panic and justifiable anger on the part of the public when in six to 18
months "the chickens come home to roost", as content analysis suggests,
they are increasingly liable to do.
A full Intelligence Update (£ 40 / $85 paper, £ 25 / $55 HTML)
which contains all the trends and supporting analysis for this Bulletin can be purchased from:
Email: jan@trendmonitor.com
Web: http://www.trendmonitor.com.
It becomes increasingly difficult to keep pace with the growth of knowledge
management resources. Now in its second issue is Knowledge Management
magazine, by Learned Information, first launched at its conference in
March, and a companion to its Web site
(http://www.knowledge-management.co.uk). More newsy and lightweight than
the more serious and case study oriented publications (e.g. Knowledge Inc.,
Knowledge Management Review and Journal of Knowledge Management), it
nevertheless has some interesting features, interviews, as well as web site
resources.
We checked most of these out. It you're looking beyond technology only two
even half captured our interest:
- The Knowledge Manager (http://www.educom.com.au) - Interesting
since it covers the Australia / New Zealand scene, but it does have a document
management emphasis. Update (1999) - This does not appear to have continued beyond the first issue!
- Knowledge at Work (http://www.knowledge-at-work.com) - Some useful resources e.g. on vendor's white papers (but only up to 1997), and various articles, books. But it seems to promise more than it delivers and the site
seems to be updated only on an ad-hoc basis (the last update even today was
in May).
See Knowledge Management Resources for current resource links.
13-17 July 1998. Knowledge '98, London. Exhibition plus accompanying
tutorials/workshops.
http://www.unicom.co.uk
3-5 August 1998. The World Innovation and Strategy Conference 1998 (WISC98)
incorporating ISQFD 98, Sydney.
E-mail: wisc98@icmsaust.com.au
10-12 August 1998. Winning Strategies for Knowledge Management, Chicago.
IQPC.
http://www.iqpc.com
17 - 19 September 1998. 3rd Chief Learning Officer Conference, Boston.
http://www.linkageinc.com
23-28 September 1998. Telework '98. Lisbon. Europe's main annual assembly
on telework and related topics.
http://www.teleman.pt/telework98/
13-15 October 1998. KM Expo '98, Chicago.
http://kmexpo.com
13-14 October 1998. Knowledge Management. Munich. Auf Deutsch und Englisch.
ComMunic.
Tel: +49 89 74 11 7270
22-23 October, 1998. Third Annual Symposium on Knowledge Management
"Lessons from the Leading Edge", Williamsburg, Virginia. AQPC.
http://www.apqc.org
For telework events visit the events calendar at European Telework Online
http://www.eto.org.uk/events/
The Fad Bit is Past
In last month's edition, I cited a recent survey that reported only 2 per
cent of managers believing that knowledge management was still a fad. I had
mislaid the source at the time, but it was the 1998 KPMG Annual Knowledge
Management survey, which also has some other interesting results.
Interestingly, a recent Delphi survey came up with a similarly low figure,
6 per cent, confirming the sharp decline in 'faddishness' since a year ago.
Copies of the KMPG report are available free from Robert Taylor at KPMG
Tel: +44 171 311 8021, E-mail: robert.taylor@kpmg.co.uk
Demand for CKOs Increasing
A recent Information Week article (19th June 1998), cited strong demand for
CKOs and CLOs (Chief Learning Officers): "Companies are serious about
implementing learning and knowledge programmes.... salaries of $200K-$235K
are typical... at the high end, they may reach $750K". The article noted
that there appears to be no standard qualifications. Frank Bordonaro, CLO
at Prudential Insurance says that the most fundamental requirement is the
right temperament: "a propensity towards calculated risk, a dissatisfaction
with the status quo and an impulse to integrate things that haven't been
integrated".
© Copyright, 1998. David Skyrme Associates Limited and Authors - All rights reserved.
This newsletter is copyright material. In the interests of dissemination of
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I3 UPDATE / ENTOVATION International News is a joint publication of David Skyrme Associates Limited and ENTOVATION International Limited - providers of trends analysis, strategic advice and workshops on knowledge management
and knowledge innovation®
Email: info@skyrme.com debra@entovation.com
Web: http://www.skyrme.com http://www.entovation.com
® Knowledge Innovation is a registered trade mark of ENTOVATION International.
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