The heart is a fascinating organ. It pulsates throughout the body, and you want the pulse because that means you are alive; The heart does the body work! The same applies to your business. VTMs are the bodies that do the work for your business and product success.

You might ask, what are VTMs? Employees are often geographically dispersed working on projects with their cohorts known as virtual work. The employees, Virtual Team Members (VTMs), are responsible for their job tasks that are often intertwined with coworkers. A good perspective as a leader or facilitator of virtual teams is to view distance projects from VTMs' perspectives. Examining what that consists of can help foster efficacious virtual projects. VTMs are the pulse of distance work.

One of the reasons that VTMs are the pulse of distance work is because they are often the employees in front of customers—engaging with clients. If there is any ambiguity surrounding VTMs' duties, this might impact your business and bottom line. VTMs might be classified as sales representatives, field workers, instructional designers, account executives, or any distance business contributor within your organization. The commonality is that they are employees working at a distance often engaging with others on shared tasks and often engaging with clients to promote a product or business service.  

Think About It

Here's a virtual scenario to think about as a manager. You introduce a new product to your employees in the office. Your leadership team is responsible for presenting the information and literature to your VTMs. VTMs are to promote this new product to clients during business meetings. You (leader) send the information, likely by email. Perhaps you setup synchronous meetings, and disseminate a FAQ sheet. You might reason that you have covered your fundamentals and met your manager's request. You might even follow-up with your VTMs to see if they are doing well promoting this innovative product.  

Now, consider this scenario. You are the VTM. You attended the required meetings about this new product. You read the literature, and you fairly understood the product; you are off to your client meeting. You arrived at your meeting ready to reveal the dynamics of the product with your client. Your client asks, “How is this different than what I am currently using? I have the accessibility, transparency, and customer management control benefits that you have discussed. Where is my value added?

The VTM is confounded. He understands the product but does not understand comparative data and how it corresponds to what the client currently has because leadership failed to personalize the product to each client's needs or explained comparative data.

How did management/leadership miss the preparatory steps when it seemed that the preparatory steps were implemented? Did anyone speak with the VTMs, collectively, individually, to ensure that they understood the value added for their accounts? Or, did management place information on a slide presentation and deduct that all VTMs are good account managers; they must know how to sell; they got it!

The VTMs needed personal speaking points, an assessment of the products and the value to each client, a portable device with some ancillary information specifically for the client, and the VTMs needed to fully understand the product's uniqueness.

How should these issues be assessed? The answer in a few phrases is to know your VTMs. Help them understand the business. Reach out to them. Do weekly calls so that everyone understands what the other VTM is doing. Send out comment cards/forms that VTMs must complete, even anonymously. Have VTMs discuss their field experiences.

Remember the Pulse

Isn't it easy to forget that your heart is beating because you are busy going about your life? That sounds obtuse! But, until the heart flutters or you are fatigue and go to the physician to discover an irregular heartbeat, are you mindful of its purpose. Hopefully, this is not the reality of your experiences. VTMs are the pulse of the organization. They are the heartbeat that interfaces with customers. VTMs have layers that should be considered if you have virtual workers. Here are points to bear in mind:

• Connection - Managers need to connect with their VTMs weekly or twice a month. Listening calls, not only more business promotions, can help VTMs feel comfortable and express what is occurring in the field. VTM to VTM connection is also a critical part of distance group work.
• Synchronous - Having synchronous meetings to explain what VTMs are accomplishing and experiencing will allow them to freely be forthcoming and connect with the business. VTMs discussing on the call or webinar products and account instances aids an element of synchronistic communication.
• Feedback - Providing feedback to employees and speaking with them individually to see if they understand the business, products, and are encountering any resistance are all worth management investment.

If you want to continually expose virtual workers to field assignments and clients, then do not forget about the virtual worker. Make sure that you have exhausted all possibilities to connect with VTMs - the pulse of distance work.

Through our years of designing, developing, and implementing knowledge and information management technologies, we’ve consistently regarded user understanding and buy-in as key criteria for success. The change management profession aims to reduce the purported 70% failure rate on large projects by concentrating on the people side of change. Change professionals focus on communications, training, and stakeholder engagement activities for projects ranging from the rollout of a new document management system to a new records retention process to a corporate reorganization.

Typically, change management activities are aligned with project management activities, and change professionals often sit in a Program Management Organization (PMO). A traditional, or waterfall, project involves determining all requirements in advance and choosing a go-live date based on expected level of effort, with little tolerance for adjustments along the way. Change management for a waterfall project might include a large upfront stakeholder analysis, a one-time training push, and a PR campaign timed around a go-live date.

However, most of the projects in need of change management activities, including knowledge and information management (KIM) projects, tend to be long and complex. This makes “big” upfront change management a risky proposition. No organization is in a static state, so findings from an initial stakeholder analysis may be invalid by the time the project is ready to launch. At this point, change managers often have very little ability to accurately predict successful user adoption. And once the project is live, it’s too late.

How can you ensure your change management approach resonates? Take an Agile approach.

Agile software development aims to reduce risk by taking an iterative, incremental approach to building a product. By engaging users on a regular basis to gain feedback, teams have regular opportunities to correct course and ultimately deliver a more successful product. At EK, we take the same approach with user adoption initiatives, allowing them to adapt along with user needs and new information.

It’s important that the first adoption initiative is Agile adoption; that is, the project team needs to adopt the Agile mindset before other change management activities take place. This has an added value of driving Agile Transformation within an organization, yielding improved methodologies for system design, development, and implementation from end to end.

Once teams have gone Agile, change management activities on the project can begin to take place. This is a new experience for many change practitioners, since the profession has typically been aligned with waterfall. Indeed, we’ve commonly seen organizations that call themselves or their projects Agile, but are actually just doing waterfall but employing loosely actualized Agile terms. But as evinced by content at a recent conference put on by the Association of Change Management Professionals (ACMP), change management practices need to evolve to keep pace with an Agile environment.

But how do you effect change iteratively? Change management for Agile projects has many similarities with Agile Marketing, which focuses on taking an iterative approach to content production. By keeping communications activities bite-sized, change professionals can focus on measuring the effectiveness of content and minimize wasted effort. It’s also key to set up a robust feedback mechanism to involve stakeholders early on in the project. Next, change managers should focus on collaborating to design an intuitive product or process rather than extensive training. Finally, change professionals must reflect on their own process regularly, allowing space for innovation and improvement.

The bottom line: By iterating often, change professionals can align themselves more closely with the direction of the project, take into account shifting priorities and ultimately, have a better chance of successful user adoption.

Knowledge Management is becoming more important as organizations continue to grow and face numerous challenges. As Wiig stated, “Competitiveness in the new world is directly dependent not only on the value and sophistication of the knowledge assets but also on how well they are renewed and utilized to conduct competent work” (Wiig 1999). Recently, the board of directors of the African Development Bank Group (ADBG) approved their Knowledge Management strategy, declaring that “knowledge and innovation have emerged as crucial features of development strategies in many parts of the world”.

Knowledge management does not only allow organizations to become smarter and in turn generate higher levels of competency, but it also reduces the cost of losing critical knowledge when talent walks out the door. According to Zenworkplace.com, companies can spend as much as $250,000 per 12 employees that leave the company. The costs are associated with training, lowered productivity, recruitment, but above all things, replacing critical knowledge. “It’s not just about putting numbers in a spreadsheet, writing code, or selling a product. It’s about knowing the people, the traditions, the location of relevant information, what the boss likes and a million other things that come from working for a company for a long period of time. All that goes away when someone quits.” (Lucas, S. 2014).

(credits:  dilbert.com) 

The key element in knowledge management is critical knowledge. This knowledge is derived from analyzing a series of elements related to the organization´s strategy such as its value preposition, market segments, new product development, balanced scorecard and any other relevant information which the organization applies in order to steer forward it´s strategy. This statement is also supported by Wharton management professor Martin Ihrig: “When you look at knowledge management [historically], there was a tendency to try to capture all the knowledge in an organization. First of all, this is not possible. It’s really hard to capture all the tacit experience and put it into a computer system. But even if it were possible, you’d suffer cognitive overload because it’s just too much. So what we propose is [to] really focus on the knowledge assets that are critical for success and underpin performance. Those critical knowledge assets should be mapped so that the management can decide how to further develop [them] to create growth and competitive advantage”

From the above we can declare that knowledge management deals with the identification and development of critical knowledge. This entails nurturing a knowledge driven culture as people are at the center of the strategy.  Although technology is becoming more relevant in terms of connectivy, co-creation and collaboration (also known as the three C´s thrusting forward the new generation of knowledge management), we need to bear in mind that technology is not the core solution. As I mentioned in a recent post (Knowledge Management and the Sharepoint Era),  Knowledge management effectiveness won´t be measured for the quality of the platform; it will be measured by how much it has impacted in the organization´s results. You need to design the strategy, carried to the point of identifying and developing the organization´s critical and strategic knowledge. This goal requires creativity, deals with complex issues and requires coordination among many functions in the organization.

© Jose Carlos Tenorio Favero

Introduction

In Part 1 of this article I explored the opportunity for professional service firms to apply process management practices to their services and internal support processes to drive improvements in cost and service. In Part 2 I will discuss the key role that Knowledge Management could play in helping to realise this opportunity.

A key role for Knowledge Management

Some mid to large professional service firms have established internal teams to help coordinate and drive process improvement and re-engineering activities, in a mid-sized firm this can be simply one person in a coordinating role or as ‘Director of Transformation’. In larger firms, investment can be more significant. The major global law firm Clifford Chance, established a Continuous Improvement programme, focused on improving the firm’s efficiency and service. To support this programme they set up a core team, staffed by new hires with skills in Lean and Six-Sigma improvement methodologies. This group provides a skilled resource to support their internal process improvement activities. To date the firm reports that around 450 associates and partners have been involved in Continuous Improvement projects. The firm plans to have trained 20% of its lawyers in simple continuous improvement tools by the end of 2014.⁴

However, many firms would struggle to provide such a level of resource. An alternative approach is to utilise existing functions in a firm. The IT department is one obvious option, but its analytical skills and focus is naturally on technology, not business processes. I believe a better solution lies with the Knowledge Management function, as identified in the EU report referenced in Part 1⁵: ‘This is one reason why some service firms are looking intently at knowledge management systems and practices that would allow them to capitalise more on their accumulated knowledge. In some cases this may mean codified systems of problems and solutions; in others it may mean enabling access to tacit knowledge by facilitating mentoring, networking, and location of relevant expertise. Institution of such systems is likely to mean more attention to issues of intellectual property.’

However, in my experience, a solution focused on Knowledge Management (KM) systems and practices as currently operated within professional service firms would be insufficient. This is because Knowledge Management in most professional service firms focuses on ‘technical’ content (e.g. legal precedents, consulting bids) rather than process knowledge (e.g. service definitions and performance targets, standard operating procedures for services and processes, actual service performance v targets, client service feedback, improvement activities and outcomes). Despite this, I believe that KM is well placed to play an important role in process-based improvement activities for the following reasons:

• Knowledge Management is a recognised function within most professional service firms.
• Knowledge Management already has an infrastructure and budget in place in most professional service firms - with an organisation (typically small), some established processes, and a Knowledge Management IT system.

Process management within Knowledge Management

However, to play an effective role in process improvement, Knowledge Management (KM) would need to broaden its focus and establish new processes that better integrate with the daily business in the following ways:

• Widen the KM remit to include process knowledge within the firm.
• Use the KM support network in the firm to work with each service to develop the following key knowledge artifacts: 1. A service process description 2. Key service & internal process performance targets (e.g. service level targets, fee earner target times) 3. Key performance indicators for services and internal processes.
• Establish a ‘light touch’ process for gathering individual service performance on a regular basis (ideally monthly, but at least quarterly) and make this available to service leaders and firm management for improvement actions.
• Enable the KM system to capture and share new improvement ideas and results (or utilise a separate Ideas Management system).
• Support improvement initiatives in each service team or business group by providing the required performance information and developing improved support metrics.

These changes would enable firms to effectively capture and harness the knowledge of the performance and potential improvements in daily work and drive major improvements in service efficiency and value in firms. Making service performance available would be powerful in itself in driving improvement, as in most firms this information is difficult to get. Of course the KM function alone cannot do this, but they would provide critical support to business areas to enable it. In doing so, the role of Knowledge Management in professional service firms would be broadened and strengthened to become a strategic foundation for firm-wide innovation.

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[4] This case study is discussed further in pages 121 & 129 in ‘Innovating professional services – transforming value and efficiency’ by Alastair Ross. Published May 2015 by Gower. ISBN-13: 978-1472427915

[5]‘The future of R&D in services: implications for EU research and innovation policy’, a report commissioned by the Science and Technology Foresight Unit of DG Research By PREST - Policy Research in Engineering, Science and Technology (UK) TNO (Netherlands) SERVILAB (Spain) ARCS (Austria) March 2006.

Professional Service firms are facing a number of major competitive challenges including price-down pressures from clients, accelerated by the 2008 financial crash, deregulation in some markets (such as the UK and Australian legal sectors), increasing competition from lower cost economies (such as IT services from India) and new internet-enabled business models (such as Freelancer.com in IT and design services, Crunch.co.uk in accountancy and RocketLawyer.com in legal services).

In response to these challenges, firms are increasingly recognising the need to innovate both in the services they provide and in their ways of working, to increase value to clients whilst reducing cost of delivery. A key opportunity in all professional service firms is in process-based innovation, applying techniques such as waste elimination, standardisation and right-skilling to reduce cost and improve service. This requires firms to establish and operate a systematic approach to assessing the performance of their services (for example a Due Diligence service from a law firm, an Audit service from an accountant or an internal support process such as Invoicing) and to use this information to identify and execute process improvements. And there is major opportunity for improvement – my own experience in process innovation projects¹ in major UK law firms, is that a 25-45% reduction in the direct cost of performing the service (and as much as 75% on one occasion) can be achieved. In addition there is opportunity for enabling revenue increase through improved value and service to clients. So this is an area of significant opportunity for firms.

Process management is key to service innovation

However to realise these benefits on an ongoing basis (rather than in the occasional consulting-led project) firms need to develop internal capabilities in ‘process management’, a discipline that is well established in industry with its roots in work study and more recently in Lean thinking. But this discipline is typically absent in much of services as noted in a 2006 EU report on service innovation:

‘Analysis of services innovation suggests that often services do not capitalise on on-the-job innovations: the knowledge established during service production and delivery is not "captured” and “reproduced” in successive innovations.’² This resonates with my own experience and I have found that the common reasons for firms being ineffective in process learning are:

• There is often cultural resistance to systemization of their work, especially in ‘traditional’ sectors such as law and accounting.
• Fee earners are not motivated to take time to perform post-matter analysis and capture resulting learning – it is not typically chargeable and thus does not count towards their chargeable time targets.
• Firms lack the systems and resources for process innovation to enable the capture, codification and deployment of such ‘on-the-job’ innovations.
• Firms are often heavily siloed around content areas (for instance in law firms, teams in Employment, Commercial, Real Estate and Personal Injury) and so will have little cross-fertilisation in learning.

The result of this that every day professional service firms are effectively flushing knowledge down the drain, as they are not capturing or using process knowledge.

Knowledge-driven systemization in expert-based work

A good example of the effective use of the use of knowledge to improve systemization of work in an expert culture is from Intermountain Healthcare³.
Intermountain Healthcare is a not-for-profit healthcare provider in Utah and Idaho in the USA, managing 22 hospitals and employing 33,000 people at the time of writing. Its clinical outcomes are among the best in the USA whilst it is able to operate at much lower costs than many competitors. This performance is based on a long term best practice programme run between 1995 and 2005.

The key element in Intermountain’s best practice system is the Care Process Model (CPM). This is a file which covers all steps of care for a particular type of case from Admission to Discharge and beyond. It assembles best practice in the form of flow diagrams, Decision Support tools, Practice guidelines and management information. The CPM is a collaborative endeavour, and is constantly updated as new ideas evolve.  Doctors use the CPMs as a default but can always override them if they see fit. Over 60 CPMs are now in use in the hospital group covering cases such as insulin dosing, treatment of pneumonia and lung disease.

A new Director of Research was the trigger for the programme, seeing the opportunities for improvement by capturing and sharing best practices and establishing a fact-based culture. CPMs were introduced slowly never undermining doctor’s autonomy. The philosophy as defined by the Director was:

“We are not trying to control doctors but to get the doctors to control the system”. This was a key philosophy in gaining the engagement of doctors in an expert culture, relying on inherent evidence-based peer pressure to change professional behaviours.

Clinicians from all the hospitals meet regularly to review evidence of outcomes and to agree changes to CPMs. A culture of openness has developed. Auxiliary workers can question and suggest improvements to the CPM without problems of authority.

The benefits of the formalisation of best practice were dramatic. A study in 2008 by the Institute for Health Care Delivery Research concluded that the aggregate cost savings from improved clinical performance totalled $100 million a year.

This type of ‘evidence-based’ peer pressure can be applied in professional service firms to drive improvement.

In Part 2, I will explore how Knowledge Management can play a key role to support the application of process management practices in professional service firms.