COMPETENCE, LEARNING AND KNOWLEDGE MANAGEMENT
Case Seminar
“The World Bank and
Knowledge
Management:
The Case of the Urban
Services Thematic Group”
Handels
andreas.diedrich@handels.gu.se
Spring Term 1, 2006
Klaus ALBER
Christophe
BIERONSKI
Tom GIBBS
Norbert
LUNG
Introduction
“ The regional urban sector groups
of the Bank (World Bank) understand how to undertake projects that affect
200,000 people, but how do they go to long term programs that affect
20,000,000?… knowledge management could help.” (George Gattoni, World Bank,
2000)
The case of the World Bank is
challenging, important and above all, relevant. The activities of the bank
around the world have previously been based around giving financial support to
countries seeking sustained economic development. In the case presented here,
it is made obvious that simply providing financial resources to countries can
no longer achieve this aim. In a world of advanced communications and rapid
information processing, being able to learn quickly, being competent and being
knowledgeable in your field of work is essential for survival. The fact that
the private financial sector is also meeting an increasing share of the
developing world’s needs means that the World Bank has been forced to
reconsider its priorities and purpose.
This paper explains and discusses
the measures taken by the World Bank to try to re-position itself as a
“clearing-house for knowledge about development” and will compare these
measures with theoretical arguments. To begin, we will provide a summary of the
case given to us, which outlines the events that have made it possible for the
World Bank to progress towards its aim. The paper then moves to a more detailed
look at each of the most important changes that have occurred. These are:
- The
importance of strong leadership in the process of change
- The
creation and evolution of thematic groups
- The
implementation of initiatives which have allowed knowledge to be
transferred around the organisation
- Implementation
problems and future issues
We will connect the theory from the
course literature with the case of the World Bank, keeping in the mind the
objective set out by the bank. That is, to progress from a simple money lending
institution to a lending institution with the ability to share knowledge for
the benefit its clients, the developing countries of the world.
I/ Case summary
In order to deal with
the increasing urban poverty in the world, the president of the World Bank,
James Wolfensohn who became leader of the institution in 1996, introduced a
knowledge management initiative. The bank, which was historically meant to deal
with helping developing countries to achieve sustainable economic development
with financial projects, should transform into a “Knowledge Bank” in order to
deal with broader issues such as human and social development and governance.
Before 1996 the bank was know as a
closed organisation that was headquarters driven. But at that time it was
reorganised into a matrix organisation with six geographical regions and five
cross-cutting networks. At the same time the knowledge management idea should
be implemented. First, there were troubles of communication, nobody knew really
what was meant with knowledge management and it was broadly miss-interpreted.
But after several knowledge management initiatives like the foundation of
cross-unit task forces, reports and strategy plans about how to organise the
initiative, benchmarking exercises with other organisations that performed
knowledge management and conferences for managers about knowledge management
the wheels started to role. A significant budget was provided for the
initiative, a Information and Knowledge Management Council for the
policy-making and a Knowledge Management Board for the decision-making where
implemented and so-called “thematic groups” who should gather knowledge in
their field and share common areas of expertise were created. These thematic
groups became an important precondition for the program. The networks started
to encourage practitioners to organise into groupings and discuss how to share
knowledge in the best way. The thematic groups became the principal engine for
sharing cross-country knowledge. Leaders of the groups were not announced, they
usually emerged, sometimes there also came up more then only one leader, some
groups were quite informal and collegial, some were very formally organised.
Members of the groups got access to newsletters, were invited to clinics,
outside speakers and workshops and could join discussion of topics of mutual
concern. There were also held up Knowledge Fairs where people could exchange
knowledge and explain what they were doing which became actually one of the
most effective ways to communicate knowledge management. “Learning and
knowledge sharing” also became part of the employee’s personnel evaluation.
During this development process some principal activities of knowledge
management emerged like building communities of practice, directories of
expertise, establishing help desks etc. Great effort was also put into
developing external and internal web sites, and to make them a main tool to
distribute know-how among the thematic groups and to internal and external
audiences.
But according to an external
assessment that has been made, there were still widespread variations in
group’s performance and effectiveness due to the fact that they were still
fragile and dependent on exceptional individuals who emerged as group leaders
and who might easily disappear because of system renewals and budget reductions.
For this reason, several workshops for thematic group leaders had been held and
improved tools for storing team-based work, like activity rooms, also
developed. The result of the external report also suggested to encourage
systematic communication about K M across the organisation, to revamp the
bank’s intranet which became a mess of competing websites, to issue a short and
authoritative statement about the K M strategy, to put in place a measure
instrument to track progress and to integrate K M with other operational
activities.
Major remaining problems were
integration, overload and consistency. Knowledge management was still viewed as
something separate from operations, not relevant to the day-to-day work, local
autonomy regarding the implementation of knowledge management resulted in
highly energized programs, but also led to incoherence and inconsistency
between units which further resulted in confusion about the idea of K M and a
majority of the staff members regarded the capturing and distribution of
know-how as a work-overload. Additionally, the exchanged information that was
requested was regarded as not always reliable or useful and some staff seemed
reluctant even to access the databases.
The effects of Knowledge
Management in the bank can be seen by looking at the Thematic Group on Services
to the Urban Poor. The bank’s focus on the urban poor developed in the
mid-1970s with several upgrading projects, in the 80s the priorities shifted
away especially after the bank’s reorganisation in 1987. However, the already
mentioned Wolfensohn reorganisation of 1996 turned things around. Six urban
sector management units were founded and alliances with various donor partners
like the UN and various regional development banks were formed. In 1997 the Thematic
Group on Services to the Urban Poor was founded. As a first step, this group
developed a mission statement. In 1998 a lot of brainstorming was done about
slum upgrading. A first International Dialogue for Urban Services to the Poor
was made. Additionally a program on urban upgrading and basic services was
organised. This tour was opened to all Bank staff which was involved or
interested in similar projects. Through video and internet, daily reports on
the tour’s activities and findings were available to the staff worldwide. There
has also been made a workshop about street addressing systems with the object
of producing a how-to manual.
With all these initiatives also some
problems arose, members of the group were interested in learning and sharing,
but there was little time available. To deal with that problem, they developed
simple tools to help people working with clients e.g. an “electronic toolkit”,
an introductory booklet for quick overview and references, web sites,
electronic newsletters, databases and so on. This experience made the members
learn a lot about communities of practice.
There has also been a problem of
knowledge transfer with the frequently hiring of new members and retiring of
old members. There was a lack of experience of new hires and a loss of
knowledge due to retiring. For that reason, a so-called Tacit Knowledge
Download was implemented. The idea was to interview experienced people, edit
and enhance the interview and link all documents mentioned in the interview,
such as appraisals, completion reports and evaluations. This program was pretty
successful and the question was to implement it bank wide.
With a cross-sector and
cross-network effort a new urban strategy developed, but this was not enough to
deal with the problem of urban poverty. They had to start to “think big” and
develop an action plan. In between 2 weeks this plan, which was more a
framework of global action with bilateral and multi-lateral development
institutions, was developed. The preparation of the plan was a remarkable
demonstration of teamwork among from each of the bank’s six regions.
In order to play a strategic
leadership role in the implementation of the action plan and to collect and
disseminate knowledge from all sources also from outside the bank, the
suggestion was to create new communities of practice in each city in the sense
of a fractal community.
I/ Leadership
during change and the art of framing
At the beginning of the
case there is a quote from James D. Wolfensohn, President of the World Bank, “…
our world faces a daunting challenge… half the 6 billion people who share this
earth live on less than $2 a day, and almost half of those live on less than $1
a day… today’s 6 billion people (will) grow to 8 billion in just 25 years. For
the World Bank these are more than numbers; they are a reflection of a reality
that drives to the heart of our development business.” The president of the
World Bank has frequently repeated this type of statement to show that he is
being serious about the issue and has also designated $50 billion to the task
of transforming the lives of 100 million slum residents over the next 20 years.
Knowledge management is
not a simple issue because it is a relatively new concept, involves a different
way of thinking and consequently, introducing it into an organisation requires
strong leadership. Leadership qualities include social sensitivity,
determination, trust (giving and receiving), fairness and optimism. Wolfensohn
clearly had a vision and preferred direction in which he wanted to take the
organisation. He tried to communicate this vision to his colleagues in the bank
through speeches and other top-down approaches, however this was not always
simple as one employee of the bank stated, “Only a few got what Wolfensohn was
talking about,” and that others saw it as, “another flavour of the month
programme.” The reason for this scepticism may be either, the subject of
knowledge management is too complex and it takes more than a few speeches, or
Wolfensohn has not mastered the art of framing. Undoubtedly, knowledge
management is a tricky concept for many people however, here we will first
discuss the art of framing and how it can help leaders put their ideas across.
A definition of the art of framing
can be found in the book “The art of
framing” by Fairhurst and Sarr. Framing is to determine the meaning of a
subject and to make sense of it by judging its character and significance. It
may happen when a leader needs to re-direct the vision of their organisation
like in the case of the World Bank, and then using initiative, communicate the
vision to the rest of the organisation. This can be explained by dividing the
process into three parts: language, thought and forethought.
Language is essential in
successfully communicating a vision and there are specific tools for this
purpose. Metaphors such as, “try to think outside the box,” are commonly used
by leaders such as Wolfensohn to emphasise and to motivate the imagination of
the audience. Organisational jargon and catchphrases are used to maintain a
consistency of language that is specific with the organisation’s activities and
culture. Contrast is used to underline the importance of certain concepts for
example, “…these are more than numbers; they are a reality” according to Fulmer
W. in the case study. Spin can be
used to display a negative or positive impression of a subject or idea
depending on the agenda of the speaker or leader. Stories are also a common way
of bringing life to a subject in order to make it easier for the audience to
relate to.
The next part, thought, is of course
necessary for leaders because one must understand their subject before they are
able to explain it to others. A well thought vision is of value to the
organisation and also to the leader, especially when trying to explain it.
Wolfensohn had clearly thought seriously about the vision of the World Bank
since he agreed to the financing of $50 billion for the projects that would be
spearheaded by the new knowledge management initiatives.
Forethought is important especially
when trying to explain the concept of knowledge management. Speaking about a
complex issue often requires planning so that it can be presented in the most
effective way possible. The literature discusses priming which is a
psychological term for the skill of activating associations in our memory and
is a skill that can be used in specific situations, total surprises and also in
repeatable contexts along with language tools in order to create an
understandable and coherent speech, according to Fairhurst & Sarr in “The art of framing”.
So, Wolfensohn may have
needed to work on the art of framing, however, knowledge management is a
complex issue and there may have been deeper structural changes required at the
World Bank. In fact, as J.C. Spender explains in his article “Making knowledge the basis of a dynamic
theory of the firm”.
“The possibility of resolution must
lie in the evolution of body of practices which convey an integrated sense of
scope and modality to those participating, which embrace both the
quasi-object’s social and artifactual aspects”, according to Spender, J.C. in
his article “Making knowledge the basis
of a dynamic theory of the firm”. In other words, it takes time effort to
communicate the ideas and visions of knowledge management in order to create
mutual understanding within an organisation. At the World Bank, this has been
achieved over time through a number of measures and the strong leadership of
Wolfensohn, which will be explained in the next parts of this paper.
III/ The Creation & Evolution of
thematic groups
Within this very huge
organisation, of course, there are many people with much knowledge. The World
Bank introduced so called “Thematic Groups” in order to connect those who need
to know with those who do know and to collect what is learned and shared
internally as well as externally. This connection between the employees did not
work until this “Thematic groups” were in place. “Thematic groups” as it is
called at the World Bank one will find in the literature of knowledge
management as communities-of-practice (CoP). These CoP are characterized by
many different attributes. Firstly, they are not formally defined like teams
but they evolve. The communities are informal groups who have some work-related
activities in common and are totally self managing. In the case of the World
Bank some communities had multiple-leaders (2-5). The introduction of these
“Thematic Groups” was a very good decision because the theory of
communities-of-practice argues that the creation and the sharing of knowledge
works very good within these communities. It is easier to share tacit knowledge
which, among others, leads to collaborative learning and CoP create a common
understanding. The internal structure of these communities is totally informal
and as we can see in the case of the World Bank the leaders within most of the
groups “emerged”. It was a good decision to not select leaders because that
could lead to inefficiency of the community. They also selected some leaders
and it revealed that this groups worked not so good, this decision was not
advantageous.
Donald Hislop in his
book “Knowledge Management in
Organisations – A critical Introduction” argues that CoP are highly
dynamic, evolving as new members become absorbed into a community, as existing
leave, and as the knowledge and practices of the community evolves with
changing circumstances.
The three main characteristics of
communities-of-practice cited in the literature are firstly, a body of common
knowledge/practice, secondly a sense of shared identity and thirdly some common
and overlapping values. These traits underpin the knowledge processes in
organisations.
The management of
communities-of-practice is not very easy but the World Bank did a quite good
job. The problem of these communities is that they emerge informal and have
somewhat ad hoc nature. This means they are not easy to control. Especially in
this huge organisation where over time more than 100 communities emerged it is
difficult. The World Bank, however, took appropriate steps to manage them by
just a “light touch” and by reinforcing essential attributes like they further
developed the knowledge initiatives and some kind of guided the thematic teams
to the “right” direction. Exactly this should be the way of managing a CoP.
In the course of time, they even
enlarged the area of these communities by sharing knowledge cross-country. This
was a very good step in our opinion because the more communities exist the
better is the process of gaining knowledge for an organisation. If these
communities are linked not just internally within the company but across the
organisational borders they are called networks of communities (NoC). These NoC
link many communities-of-practice and increase the efficiency of the knowledge
process. To sum it up, the introduction of communities-of-practice was a very
good step to increase the knowledge process of gaining and sharing knowledge
between people who do know and those who need to know. Regarding the future
development of the groups it should be said, that due to the fact that they
just “emerge” and are informal it becomes more difficult to control them which
should be taken into consideration for the management of this groups.
IV/ Knowledge initiatives –
collecting, sharing and implementing knowledge activities
The World Bank,
furthermore, increased the knowledge initiatives in order to improve the
development and, particular, the sharing of knowledge. Hence, Knowledge Fairs
were introduced where people got a booth and could present what they are doing
in their job. Here again the idea which was introduced was very good and when
we focus on the theoretic background of these measures we can see that the
topic knowledge sharing is going to cover these actions. According to Nonaka
& Takeuchi in their famous book “The
Knowledge-Creating Company”, knowledge is identified as the main source of
competitive advantage and therefore, it needs methods and practices in order to
supervise its sharing.
All transfers in an organisations
help to create some kind of culture. N. Dixon, for instance, distinguishes five
categories: 1) Serial transfer occurs when the knowledge of each member is
spread in to the team in a way that everyone can understand; 2) Near transfer
appears when knowledge is reused by a second team within the same organisation;
3) Far transfer is knowledge that a team acquired from its own experience and
makes it available to others in the organisation; 4) Strategic transfer can be
described as recycling knowledge. 5) Expert transfer occurs when teams are
facing some problems which are outside their range of knowledge and they look
for the expertise of others inside the organisation;
When we try to analyze the knowledge
initiatives of the World Bank we can see that they tried exactly to make these
knowledge transfers. However, they did not just implemented these parts but
they further improved this system by sharing the knowledge not only within the
same company but made fairs where teams from other banks were able to
participate to increase the spread of knowledge across the organisational
boundaries. These processes of sharing knowledge between many organisations are
also called intercommunity-knowledge-processes. They are characterized by the
collaboration between individuals who are likely and have the limited amount
knowledge in common as well as a shared identity. Factors that
knowledge-sharing between organisations is effective are according to Hansen
the willingness and the ability to share. Furthermore, trust plays an important
role when it comes to sharing knowledge and the development of trust is an
ongoing dynamic process which is, among others based on attributes like, for
instance, commitment, competence of the people and so on.
In our case the World Bank managed
this point in a good way by providing a good frame that knowledge could be
shared and, furthermore, when it comes to the evaluation if the processes
implemented really improved the situation or it they have gone in the right
direction we just can say that the external assessment from external
specialists was a clever move because when we look in the theory of
intercommunity-knowledge-processes we can see some critical points that can
affect these processes. That is to say, there are some factors that make the
intercommunity knowledge processes difficult. Firstly, there is a limited
amount of common knowledge, secondly the knowledge possessed by people is
“sticky” and difficult to share (it is highly tacit and context-specific) and
thirdly the knowledge is based on different assumptions, values and
experiences. Especially the last point may be difficult to deal with when it
comes to knowledge sharing between organisations which are spread over
different continents, for instance.
Indeed, the technology
used by the World Bank, namely internet-websites, intranet, newsletter, etc.
helped to make knowledge more transparent to everybody and helped to tackle the
problem. Technology is definitely a core issue in knowledge management and,
moreover in the area of sharing knowledge. The World Bank, that has to be said,
focused on nearly all the important aspects of implementing the knowledge
management strategy and also took into consideration the problems which can
occur and tried to install some kind of control for these processes.
V/ Implementations’ problems and
future issues
1. The present
problems
At
the beginning of the process of implementation of the knowledge management,
there were some misunderstandings about what was implemented, why it was
implemented and in what way it was useful for the World Bank to do that. These
misunderstandings disappeared thanks to a more well-implemented communication
trough seminar, meeting and also communities of practice development, which are
ways of better communication, according to many authors.
However, over the implementation of
the knowledge management program and initiatives, the knowledge manager and the
top management realized, thanks to reports, the attendance of several problems
with the use of the knowledge tools. Theses issues were quoted in the summary.
First of all, the issue
is the integration of the knowledge management in the day-to-day work.
According to DeSanctis G. & Poole M.S. in the article “Capturing the complexity in advanced technology: adaptive structuration
theory”, the integration of a new technology or work process could take a
long time, verily be impossible. This phenomenon exists because new structures
and way of working provided by new technologies have to be matched with
existing organisational practices. In the World Bank case, this system is quite
new and people need time to integrate it in their way of working. There are
several recommendations about this issue, one will introduce the ones which are
the more relevant in this case. The management could implement incentives to
the use of this material, either it could involve users to participate in the
material development, in order to sensitize them to it relevance, if people
agree to spend time in the development of a tool, they will automatically be motivated
to use it. Another recommendation, the management could put forward a formation
to the use of the material and in the same way develop a support for problems
and technical questions. Likewise, since, the bank has moved simply beyond
simply financing projects to address broader issues as human and social
development governance, this shift is relevant and has to be seen as a chance
to change the patterns of working, so a faster integration of the new
technology in a new patterns of working.
Secondly, the reluctance
of the people to use the new available material. This reluctance is a main
consequence of overloads problems and the system complexity. This point is
quite linked to the previous issue because of its effect on the use of the new
material. Indeed, people were unable to search information in a huge database
because of it size and their lack of competences concerning the search engine.
Some people were worried about the fact that they probably re-introduced
already available information. According
to a survey, 37% of new material users agreed that the Bank’s knowledge
resources on the web were easily accessible. Some people underlined the fact
that it was not organised or that it was too much information and there
majority was not relevant. It puts down the question of databases overloads.
Indeed, many years ago, before the development of internet and new
technologies, the lack of information was regular and all efforts were pointed
on the accumulation of information and its treatment. Firms which had much
information and furthermore relevant were minorities. But currently, after the
internet boom and the development of new technologies which did it available
for the majority of firms, the information inflow is relentless and it ensues
from time to time in overloads problems which hurts the effectiveness of
databases. Actually, too much information kills the information whereas before
it was the contrary, a lack of information. When people are using databases to
search for relevant information, they do not want to spend more time then a
manual search or a call to a colleague. Furthermore, according to certain
authors, people tend to rely on personal networks for
information, rather than on a central data repository.
John Seely Brow, chief
scientist at Xerox Corp. underlines
the idea that “electronically stored information should follow, rather than
change, human interaction is one important development in the effort to help
people cope with the oft-lamented "information overload" problem.”
So, in order to improve the effectiveness of databases, the World Bank has to
develop or implement better tools and engines, like the Outride search tool
which as implemented in Palo Alto’s Xerox Corp Research Center.
Paul Saffo, a director of the Institute for the Future, a non-profit
research organisation in
Thirdly,
the top management has to cope with the fast development of thematic groups and
its people involvement. Indeed, as it is written in the book, by late 1999
there were 124 thematic groups in the World Bank. These groups were very
autonomous and perceived the implemented knowledge management with their own
point of view, which could be totally different from one group to another. A
1999’s survey showed then at least 25% of surveyed people were not sure whether
the strategy was clear or not. The groups’ multiplication and some attempts on
the part of top management to control the creation and combining of groups
putted in jeopardy it existence and effectiveness.
According to some authors, the
management of communities of practise has to be done unobtrusively and not with
huge direct ways. Indeed, these groups are easily breakable and the existence
and effectiveness of the firm is bound with them.
2. Future issues and challenges
Through
years of knowledge management implementation, the World Bank putted in place a
knowledge management system through the entire firm. People is more or less
involved in it use but as we said it will change slowly with the implementation
of incentives, etc…and just simply because of the change in minds.
Knowledge collecting is in a good
way and some tacit knowledge download is also implemented through the firm.
Recently, the World Bank announced a
huge and deeper strategy to achieve goals of fighting poverty in the world and
slums upgrading, the so-called “Cities Without Slums” plan which is a remake
plan because Wolfensohn wants the bank to think bigger, in order to fit in a
better way with bank expectations in the future and also to give a coherent and
huge strategy to increase its competitive advantage in relation to private bank
sector.
One
of the main issue the World Bank will face is the development of the knowledge
network outside of the bank because of the development of relations with others
organisations, regional institutions, partners, etc…It puts down also the
problem of knowledge collect outside of the bank and the generalisation of
these practices outside the bank. Indeed, the bank would like to become a
“knowledge bank”. According to the theory, creating a knowledge structure is
already though in a firm, so outside the firm, where others firms/groups are
not sharing the same values and patterns of working, the implementation of a
knowledge structure could be seen as a no way out. In order to share knowledge with
clients and partners, the World Bank has to gather together no just internal
knowledge but also external knowledge issued by people working with the World
Bank. This exchange has to take place in order to increase the relevance of
information provided outside the bank.
Another
main issue concerns the viability of communities of practice. As we seen in the
part dealing with the CoP’s implementation, it introduction in the World Bank
structure was not so problematic and it continuously developed through the
development, helped by the top management involvement and incentives.
But, we can put down the issue of
these communities in the future and it development which has to fit the
development of the World Bank strategy: bilateral cooperation, new partners.
There is no evidence at this present time that the communities of practice will
develop externally to the firm through its working network.
That is why Roberto Chavez has
attended of the mission to develop new communities of practices in the client countries
which are called “fractal communities”. By this expression, Chavez means the
creation of communities inside the communities of practice, which explains the
use of the word fractal, which is a pattern or an image which is repeating ad
infinitum (e.g. Sierpinski’s triangle, Menger’s sponge). In this case, the
world-bank staff will be in charge of coordinating and facilitating the
building of these fractal communities in others countries.
Conclusion
Through
this case study, we realized the complexity and challenges of building a
knowledge management structure inside a firm. As one showed in the study, the
success of the implementation’s first steps is due to the charismatic person
which rests in John Wolfensohn. He was the leader, definer and defender of the
knowledge management implementation trough the World Bank and always believed
in it, which is very relevant to motivate and convince people. One has noted
that John Wolfensohn behaviour fits very well with the theory about framing and
leading projects.
One has noted also the
implementation of communities of practice through the firm which are essential
factors for the development of a knowledge culture and also a good way to begin
the transfer of knowledge between individuals and also between groups.
Initiatives as workshops, fares, seminars and meetings have been important
elements to the constitution of this common knowledge sharing. There are still
some issues which pose some problems (overloads, etc…) but they are currently
managed and will probably disappear if the management is effective.
Of course, as one seen in the study,
the firm is quite far from it final achievement of the knowledge management
because of it “think big” strategy which will need time and very good
implementation and actors coordination. This is one of the main challenges for
the World Bank and according to the implementation of the knowledge management,
it will probably achieve.
The World Bank’s development is
totally understandable in this so-called “knowledge society” where are living
in. This new phase matches also with the third major evolution in the concept
and structure of organisation, “the shift from the command-and-control
organisation, the organisation of departments and divisions, to the
information-based organisation, the organisation of knowledge specialists”
according to Peter F. Drucker in his article “The coming of the new
organisation”. So the present shift is totally normal and is done to fit with
the environment and also in the World Bank case, to implement a competitive
advantage by providing more than monetary funds, it provides a huge knowledge
to uses the funds in the most effective way, which is a determinative argument
when one knows the situation of developing countries and their indebtedness due
to the ineffective use of funds. It is a very good way to develop loyalty
between the clients and the World Bank which are sharing most then just a
monetary relation, but a real common vision of the country’s development and a
real commitment to the effectiveness of the World Bank services.