September 30, 2011

Key Man Insurance

A few years ago it was common for organisations to think in terms of insuring their key assets; physical and human. Insurance cover was put in place for buildings and plant / machinery and for key individuals. In those days they tended to be men and hence this type of cover was referred to as ‘key man insurance’. In these more enlightened times we would refer to it as ‘key person insurance’.

The thought process was very simple; if it’s important and we could lose it or it could get damaged and hence unusable or unproductive we need to insure against that possibility. Let’s assume that the board of directors thought that the head of product development was a key individual, they would then take out insurance cover on that individual. If they became unavailable (die or seriously injured) the insurance company would pay out the insured sum.

The next part is the interesting part for me. The logic of the insurance was that now the company had the money they would go out and find a short term and a longer term replacement for the key person. The HR department would be told ‘we have X dollars, go and hire a short term standing for our head of product development’. I guess the assumption was that they would go to a head hunter who would target head of development in competitor organisations and equipped with the pot of gold would tempt the person to join the company. Or perhaps the assumption was that head of development departments were just hanging about at home with no employment waiting for the telephone to ring.

Now never mind the time delay in recruiting someone (what is the time lag between identifying the need for an additional resource and them sitting at a desk in your organisation?) but the assumption was also made that they would instantly be productive when they arrived at the new organisation.

All of this brings me around to the need to identify the key knowledge that the organisation needs and have it available in such a form that multiple people can access it and use it. Surely this a better form of insurance than just paying out a sum of money if a single person is no longer available to the company.
The need to have the key knowledge identified and have it available to multiple people was highlighted this week in a conversation I had with a sales and business director.

The company that he works for has a villa and boat in a rather nice part of the world so he decided to chill out for a couple of days and make use of them. One evening when he was going back on to the boat, he slipped, the barrier didn’t hold, he fell about six feet, smashed his shoulder against the boat and landed on the dive platform at the rear. By some miracle he didn’t fall into the water or he would have drowned there and then. The thump of him landing on the dive platform was heard by the security guards who came to his rescue, they pulled him up to the jetty (using his destroyed shoulder). He was in shock and told them that he was ok so they left him. He spent the night lying on the jetty and was in a very serious state when people arrived in the morning.

He survived and in time will fully recover but it was a wake up call. He had the ‘strategy’ for business development for his company in his head. Apart from informal discussions with other directors, he was the only one who had any idea of what he was planning.

What ‘insurance’ do you have in place for your key individuals?


Knoco Ltd

September 16, 2011

Trust Is Vital

Trust.

If you consult a thesaurus you might find trust defined as ‘faith, belief or confidence’. It is the thing that makes us move from considering something to acting upon it. In some instances the trust level will be very high initially so if someone tells us something or shares advice with us, we accept it at face value and act upon it. Typically the longer you have known that person and the greater the positive track record they have with you, the more likely you are to ‘trust’ their advice and suggestions and act upon it.

Trust is very important. In our training sessions we often use the example of standing in an airport and looking at the departure board when someone you have never met walks up to you and offers advice on which flight to take eg “Don’t take that one, its always delayed, better to use that one”. Most people would agree that because you have no relationship with the person, the trust level will be very low so the probability of you accepting the advice is close to zero unless you find something else that would cause you to accept the advice.

Now when we come to the work place we are can be faced with a situation similar to that above eg someone in another office wants to share advice; another plant wants to share best practice with you; someone has posted in the collaboration area a tip on how to improve productivity etc. Some people will accept the advice (they are in the same company as me so why would they lie to me or give me bad advice) while others will find a reason not to accept the advice (their context is different from mine). Some will be in the middle and will take some sort of action to obtain further details before they are convinced to accept the advice.

In the later case they are topping up their ‘convincer mechanism’, that thing in our brains that makes us comfortable with the decision we have made. It’s a well know sales that people need to find a number of reasons to support their decision to buy. A rule of thumb is that the buyer will need three positive elements supporting their decision to buy before their convincer mechanism flicks to positive and they agree to buy.

But what do you do when the number is higher than three? How do you work with an individual (this is an individual level phenomena) who has a very high convincer mechanism? Outwardly it might appear that they don’t trust people. You present something that has worked at another plant or location. You present 3 pieces of data to support it but that’s not enough. Do they need 7,9,15 or 40 pieces of data before their internal convincer will flick positive and they will accept the advice of others? They probably don’t know themselves.

When we were establishing Knoco as a company I went to visit the director of a very large and very well known company to ask his advice. One of the things he said to me was if he ever asked me a for a discount on our fees always refuse and say the price had been calculated and fixed. His rational was that if I said we could offer 3%, he would think he could get 5%. If I then gave him 5%, he would think that he could then get 5.7%. If I agreed to that he would then think that he could get another 2% on top of what he had already obtained. The bottom line was that he would never be satisfied with the discount he had achieved (he would always think there was just a little more to be squeezed out) and as a result the contract would never be signed.

In this instance the guy was very honest about his behaviour. He understood how his convincer worked, it was based on trust and a belief that he would always be given the best price possible by suppliers. That trust was broken if you gave an indication you hadn’t given him the best price first time around. It’s wouldn’t be possible to regain his trust as his convincer would never flick to positive because would keep looking for that last piece of evidence.

So if you meet someone who doesn’t seem to want to act on the advice of others perhaps it’s just because his convincer mechanism hasn’t received sufficient pieces of positive data to cause his convincer mechanism to flick to the positive.
Alternatively something in their past might have occurred that genuinely causes them not to trust people now.

For a workplace perspective never mind a knowledge management perspective, these are very difficult people to work with.

September 8, 2011

Social Media Video

I am not sure why but I can't re-open the blog that I have just posted to include this link to the video that I mention. If you want to see the video click here.

Is Social Media For Us?

I was watching a video clip on the use of Social Media within a corporate environment and it touched on the need for senior management ‘to trust the workforce’ which reminded me of the very early days of video conferencing.

In the mid 1990’s when we were putting video conferencing offshore as part of the virtual teamworking project one of the most hotly debated items was ‘trusting the workforce’. At that point in time it wasn’t possible to telephone someone on an offshore platform. Calls were routed to the onshore office and then if appropriate to the office on the platform. The video conferencing worked on ISDN lines which meant that if someone onshore got a hold of the telephone number for the video conferencing unit, they would be able to dial it directly, bypassing all the existing control and filtering mechanisms.

The other issue was that the computers that were installed offshore had unlimited access to the world wide web, something that was unheard of at the time. There was great concern that the guys would spend all their time searching for information about their favourite soccer teams and let’s be polite, gentleman’s sites. It was interesting that we would trust people to work in an a hazardous environment with hazardous materials but there was concern about whether they could be trusted to use the web sensibly.

Today this might sound like a trivial exercise as the web is almost universally accessible using a multitude of devices but in the mid 1990’s this was a very serious debate.

The compromise that was reached was that everyone using the technology was told that while there was no intention to track what people were searching for or viewing, would they be embarrassed if their colleagues were told what pages they had viewed. Inappropriate use of the technology was never a problem in reality.

And so it is with the latest technology – social media. With everything new people fall into different camps. There will be those who will install anything new, just because it is new and at the opposite end of the spectrum there are those who will oppose anything new, just because it is new.

If asked whether organisations should have social media, I pose the following question; “What is the business goal you are seeking to deliver?”

For me it isn’t about utilising a new piece of technology but rather being clear on what is the business goal that you are seeking to achieve and will this technology assist you to deliver it? Once you have that clear you can then undertake a traditional risk / benefit analysis to determine whether it is the correct thing to invest in.

One of the things that you should include in the risk / benefits matrix is the impact on internal communications as well as external communications. How will staff be clear on the position of the company on a particular issue if everyone in the company is allowed to Tweet or Yammer?

Technology is a good thing. Social Media is a good thing. Those who are clear on how it will assist them to deliver the desired business goal are likely to be pleased with the investment they make. Those who aren’t are frequently disappointed.