The Future of Management in the Knowledge Economy

 

As I mentioned in my recent post called The Language of Innovation, Gary Hamel is onto something truly vital with his work on Moonshots for Management. Inspired by the National Academy of Engineering’s Grand Engineering Challenges and the work of the X-Prize Foundation, Hamel and a group of the world’s most recognizable innovators spent two days together last May defining twenty-five make or break challenges for the future of management in the 21st century. Why define these make or break challenges? As Hamel explains, many of today’s management techniques originated in the late 19th century with one specific purpose: train semi-skilled human resources to repeat manual tasks at ever increasing levels of efficiency. Simply put, these management techniques are ill suited to today’s organizations which operate not in an industrial, but in a knowledge economy.

So what’s a knowledge economy and why is it important to management techniques? The term knowledge economy was introduced into the mainstream by Peter Drucker in his 1966 book The Effective Executive to differentiate an economy where organizations profit by the labor of employees who worked with their heads, not their hands. Since its introduction the idea of a knowledge economy has become widely accepted. Today the World Bank ranks nations annually in its Knowledge Economy Index according to the four pillars of its Knowledge Assessment Methodology: economic incentive and institutional regime; education and training; innovation and technological adoption; and information and communication technologies (ICT) infrastructure. As one might suspect, in 2008, eight years after adoption of the Lisbon Strategy, European countries dominated the knowledge index ranking with Denmark at the top. The U.S. currently ranks number 9.

Lawyers, doctors, software engineers, teachers, scientists and public servants are all considered knowledge workers. The twenty-five moonshots Hamel and his colleagues defined speak volumes about how to manage knowledge workers so they can be most effective. Moonshot #2, Fully Embed the Ideas of Community and Citizenship in Management Systems, makes a lot of sense to me. As we all know too well, knowledge is a precious commodity and as professionals we all need and learn from each other. It seems today that things change so rapidly it takes an entire community to master a discipline. As do moonshots #6, Reinvent the Means of Control and #7, Redefine the Work of Leadership. When managing knowledge workers we must transcend the dichotomy between discipline and innovation as mutually exclusive opposites. And if it takes an entire community to master a discipline, leaders must evolve into social-systems architects who enable collaboration and innovation rather than constrain decisions. Moonshot #5, Reduce Fear and Increase Trust as well as #8, Expand and Exploit Diversity, strengthen both the culture and the effectiveness of an organization. Eric Schmidt, CEO of Google, describes in this conference video how the effectiveness of the Google organization is embedded within its culture. Finally Moonshot #15, Create a Democracy of Information, articulates a very optimistic view of how information technology can empower us all to act on behalf of the entire organization.

These are just a few of my favorites. Please let me know yours. I hope you enjoy challenges as I do. Whether you’re a knowledge worker, a leader or a manager these Moonshots are our challenges together.