Staying Smart: Industry Firms Refine Knowledge Management to Build On What They Know
"The ability to learn faster than your competitors may be the only sustainable competitive advantage.”
—Arie de Geus, business theorist and former Shell Oil executive in his 1997 book The Living Company
Christopher Parsons, an architecture firm IT leader turned design-sector knowledge-management guru, says he starts all his lectures with the famous quotation from de Geus, the much-lauded business exec and strategist, to emphasize the critical link between culture-driven corporate knowledge and success for construction industry firms in an era of big changes and Big Data.
“We see the rate of change speeding up—whether it’s codes, software, materials, expectations of clients or work across multiple geographies—with demands on quality and speed going up while schedules and budgets go down and baby boomers are retiring,” says Parsons, founder and CEO of software developer Knowledge Architecture and creator of intranet platform Synthesis, who launched the KA Connect knowledge management conferences and community in 2009.
“So, there’s this huge, increasingly difficult-to-navigate knowledge problem in the AEC industry, and these are all things that … an intentional approach to knowledge management can help in keeping firms competitive,” he says.
KM scholar Katrina Pugh, director of the Information and Knowledge Strategy Program at Columbia University, says, “Our competitive advantage [today] is not just that we’re supersmart but in how we bring other people together. It takes new skills.” This is particularly true as more firms tap into what employees have collected in their heads through experience—“tacit knowledge that is unverbalized,” she says. “We have blind spots. We don’t always know what we know.”
KM dates back to the 1990s digital revolution, when new software and web-based tools made it easier to capture and share information. A number of mostly larger AEC sector firms have had programs since then, among the hundreds of all types of companis and organizations tracked by the Houston-based American Productivity & Quality Center, a business research and advocacy group that touts 550 members in 45 global industries.
In its survey several years ago of 750 technically focused organizations, 47% of respondents said they had formal KM programs in place, as did half of the 22 design and construction respondents. Among such programs, APQC says it has featured the best practices of Arup, Fluor Corp., PB/WSP and MWH Global (now part of Stantec).
“Structured KM programs tend to be more prevalent in industries where errors carry large risks,” says Lauren Trees, APQC principal KM research lead, who also notes construction’s need for specialized expertise, its reuse of intellectual property across projects and its use of knowledge as a competitive differentiator.
She points to positive results for APQC member NextEraEnergy’s power generation division, which has documented more than $11 million in net-value savings from multiple KM improvements since 2013. “An organization without a structured KM effort is probably wasting time and money,” says Trees, adding that workers can spend 16% of time every 40-hour workweek looking for information, with 44% not finding it.
But preserving core knowledge as employees depart is not the only catalyst for construction-sector KM. "As a knowledge-based business, our ability to capture, catalog, save and communicate our technical and project knowledge company-wide is critical," says David Leslie, business unit director at energy design firm POWER Engineers. "Preserving and enhancing that position is critical to our future success as an organization and industry leader. We believe that knowledge transfer is something that should occur continuously; it should be part of an organization’s values and culture." He adds, "We view our knowledge management platform as one of our key differentiators."
In a recent survey of programs among its members—mostly energy- and industrial-sector owners and contractors—the research-focused Construction Industry Institute (CII) found that “project-based organizations, especially those with short project cycles, see knowledge generated, reinvented and lost, as teams are formed and later broken up to work on new projects.”
CII says this survey’s findings should propel firms to develop strong knowledge-sharing cultures. The Construction Users Roundtable has been helping owner members develop knowledge transfer programs since 2013, says Phil Manning, director of membership development and resources
The data-mining boom now hitting the industry is speeding up the momentum as more firms “extract insights from large volumes of unstructured information,” says Trees. “From machine learning and natural language processing to full-fledged cognitive and artificial intelligence [AI] applications, organizations are just starting to grapple with the potential behind these new technologies and the resulting shifts in how employees access and analyze corporate knowledge.”
KA Connect’s Parsons says knowledge management pervades firms informally. But to compete now, “they need to become more intentional about spreading knowledge across the firm … with a strategy behind it,” he says. In a 2015 KA Connect survey of 125 design firms, 33% of respondents had a specified person to handle KM, with 54% of firms reporting a full-time role. But AEs also noted gaps in how well they met defined KM priorities (see chart, below).
Parsons says his conferences, tailored for the size and scope of professional services firms, now draw some 250 annual attendees. He emphasizes the point that, despite advances in KM technology, “the downside is overrelying on digital to solve problems.” Firms can find KM programs difficult to develop. “The power of knowledge sharing hinges on the full and enthusiastic participation of employees, which is a behavior change,” said Andy Ernsting, a senior principal of design firm DLR Group, at the 2015 KA Connect conference. “How do you create the sharing environment where people want to give up the tacit knowledge that’s in their brain?”
For design firm Stantec, the challenge is to harness knowledge in a company that has been a whirlwind of acquisition-driven change since the 1990s, culminating in last year’s megapurchase of MWH, which created a 22,000-person organization. Preserving and expanding the firm’s institutional memory and knowledge base “is not just getting everyone connected to everyone else,” says John Wanberg, Stantec knowledge strategy manager. “How do we connect employees in meaningful ways?”
In particular, the firm focused on “patterns of how people are interacting with each other” to determine “who’s really central in a community and important to subject matter expertise,” Wanberg says. It also is building “a skills matrix database, so we don’t have silos in the organization and can create robust networks against individual departure,” he adds. “Ultimately, that will make us stronger and provide top expertise from around the world.”
Stantec also is “building network thinking” into performance reviews. “As a leader, you are responsible for financial performance but also for how you connect and enable people around you,” Wanberg says. “This prevents one leader [from being] central to all decision-making and knowledge flows. We have to build in KM in the way we already work.” The firm also hosts a global knowledge-sharing conference and uses its corporate university not just to disperse information but also “to break up typical networks that [employees] would go to and get them to form new connections,” he adds.
CII launched its new Knowledge Base online web platform in mid-2016. Key refinements include having multiple search portals by knowledge area, project phase and best practices, as well as better organized study data and added links. “Ease of use and quick access to our body of knowledge was our goal,” says Kim S. Allen, the group’s associate director for KM and a former Monsanto executive. “Our members have viewed this as a huge improvement and a great asset.”
Fluor Corp. has become an industry KM leader, seeking to structure formally corporate memory “in earnest” in the late 1990s, says Darryl Wing, the 60,000-person global firm’s KM director. The contractor has appeared for 11 consecutive years on the global Most Admired Knowledge Enterprise (MAKE) list, a global KM-sector recognition. Multiyear awardees also include Microsoft, Samsung and ConocoPhillips.
Wing says the effort’s primary focus was to establish and maintain “communities of practice” within its Knowledge On Line (KOL) tool. He says each community has a knowledge manager position to drive employee engagement and ensure that questions are answered quickly. “Our leaders identify and approve subject-matter experts who are widely advertised in the KOL platform as the go-to people to get your questions answered on projects,” says Wing.
Fluor has six full-time KM managers and a core of part-time supporting managers from different corporate disciplines. “The role of my team is to act as a broker between those who seek the knowledge and those who have it,” says Wing.
“Developing corporate memory is a balancing act. You can’t manage all that’s inside employees’ heads, but you can manage how they connect so their tacit knowledge is shared,” he says. “We encourage employees to join relevant communities of practice—safe havens where practitioners are free and encouraged to ask questions and develop their knowledge. You will find grads in the same space as engineering leads and even senior fellows.”
Wing acknowledges, however, that “getting the right experiences in front of the right people at the right time is a challenge. We’re trying to understand how to disseminate at what time in a project life cycle.”
Fluor’s KM machine kicks into high gear when top execs pose strategic questions, generating what Wing describes as a “knowledge campaign” that targets communities and experts. “These have been very successful in gaining rapid insight in a short time, sometimes resulting in best-practice updates,” he says. Fluor’s KM program also includes its “Knowvember” focus on knowledge sharing as well as voluntary “coffee connections,” which randomly pair employees every two weeks with “people they don’t think they need to know.”
Seen as a silo-reducer, it has attracted 3,000 participants since its launch. Wing says Fluor’s KM program “has gone through interesting challenges with different generations in the company, but we feel this has really lowered the barriers to participation and engagement.”
Nuclear Knowledge Transfer
The evolving effort in nuclear power work from plant construction up to five or more decades ago to decommissioning and demolishing plants now gaining momentum poses knowledge-transfer challenges to new participants in that work.
“Being a part of an aging workforce, we have a responsibility to make sure the experience is transferred to the next generation of professionals,” says Matt Marston, AECOM senior vice president of operations decommissioning solutions at the San Onofre Nuclear Generating Station (SONGS), in California, where D&D work is in early planning. “We are expanding the core group of people who have the knowledge and can implement what we’ve learned.”
AREVA Nuclear Materials (ANM), another key nuclear-sector participant, is pushing similar approaches. “We are intentional about transfer of lessons learned. It helps employees complete tasks faster and understand what is expected,” says Prakash Narayanan, deputy director of design engineering for Areva's TN Americas unit that manages spent nuclear fuel.
“We can procedurize knowledge, but insight from an expert who has done it before is priceless,” he says, noting the often “entrepreneurial” nature of work. “New ideas are what interest new engineers,” he says. “All knowledge needs interplay.” The firm also has a new online platform for Q&A interaction with experts who range from nuclear engineers to contracts specialists. “A question usually gets multiple answers, and, as a result, there is collective problem-solving,” he says. ANM made mentoring mandatory several years ago, because “there were too many people retiring and we had a threefold increase in new hires,” says Narayanan. It now is voluntary but is included in most employees’ annual goals, he adds.
To assist industry firms to better capture employees’ experiential knowledge, academics—such as Fernanda Leite, associate professor of civil, architecture and environmental engineering at the University of Texas-Austin—are researching how to model tacit knowledge.
With grad student assistance, she tested and modeled decision-making in resolving clash-detection problems using two test groups of novices—one whose members had decision support from experts and another whose members did not. “We found that the group with decision support had a significant reduction in time spent solving clashes and could better understand the context around them,” says Leite. “The idea is to capture experiential knowledge so we can automate these processes.”
Leite’s team also is modeling crane lift data to create an “optimization algorithm” for heavy lifts, and OSHA data for a 4D model and simulations to estimate risk levels as construction progresses, that was implemented on an actual project.
In looking at next-generation developments in knowledge management, APQC’s Trees says the group’s advanced working group is exploring the potential impacts of cognitive computing on classic KM challenges such as content curation, search and discovery, expertise location, and lessons-learned analysis.
“Many of the applications are still in their infancy, but the possibilities are exciting and the sci-fi fantasy is slowly morphing into reality,” she says, noting benefits already demonstrated by industry KM leaders such as NASA, Accenture and Deloitte.
“Cognitive computing and AI seem poised to either make or break knowledge management, depending on how KM programs handle the influx of new capabilities,” says Trees. “Some think that, once it reaches maturity, AI will give employees seamless access to the organization’s collective knowledge without the need for manual interventions.”
But technology won’t “eliminate need for a solid KM and collaboration strategy nor will it make magically disappear the hard work traditionally required to understand and fulfill organizational knowledge needs,” she adds.
For firms making the KM commitment, payback can be big.
Gil Hantsch, president and CEO of design firm MSA Professional Services, credited the company’s “leap of faith” 2013 investment in a communities-of-practice platform with creating a team of employees who convinced a municipal client that its value was not only the members’ design expertise but also their developed working relationships that would benefit the project. The firm won the contract. “To me, this is really the first big success story that we hope is the beginning of lots more,” he says.