©Karl-Erik Sveiby 1 October 1994. All rights reserved. Originally published in my thesis Towards a Knowledge Perspective On Organisation.
The cars accelerate up the Kungsgatan street. Their exhausts surge towards the sky, mingle with the January frost and wrap the houses in a blue grey haze. I hear the cars through my window, four floors above them. I can smell them too through the badly isolated and dirty windows. The day is already darkening towards afternoon and I am sitting in my little office with a crumpled manuscript in my hand.
I am not feeling well, but it has only little to do with the carbon monoxide - I´m hardly aware of it. It is 1980 and I have been an employee of Affärsvärlden for less than a month and I am seriously pondering over my decision. Did I really make the right choice when I left a secure career with Unilever?
The manuscript is a well written analysis with the title "The Art of Cleaning the Affärsvärlden Office". I have just heard the author in the corridor outside talking to a colleague in the somewhat pompous style he reserves for important messages:
- I have just attended to the Cleaning Issue.
Attended to the "Cleaning Issue"! With my foot! He was the initiator of the "Cleaning Issue" on our partner conference. He came up with the idea to clean up the mess in the office and he drove it with such frenzy that he made me and the others to believe that he would actually clean the office himself. And what was the outcome of his action? An article!
I remember another episode a couple of months later:
I´m standing in front of the overhead projector with a heap of fresh charts. They con-tain the latest figures about Affärsvärlden. This is an important occasion for me. It is the first time I am about to present the estimated yearly results to my partner col-leagues. I have prepared intensely for this. I have made comparisons with last year, the budget and series since 1975 up till this year. I have made an analysis of the market shares of the competition and drawn some informative and beautiful charts in many colours. This is something an ex-Unilever man knows how to do.
But. Nobody arrives.
Yes! Camilla. (Our secretary/receptionist/sales order clerk). I ask her: - What has happened? Everybody must know that we have this meeting. - I have no idea, she said sulkily. Nobody ever tells me anything, so how should I know?
A quarter of an hour later. One of the editors passes hurriedly through the corridor:
- Hi. So you are still here?
- ??br> - Don´t you know? Volvo is having a press conference right now and I´m late.
So long!br> The meeting ends before it begins and I leave for home.
In 1980 the financial magazine Affärsvärlden was 79 years old. In 1975 it had un-dergone a management transformation. The trust that owned it was just about to close it down but some of the editorial staff had come up with a proposition: Let us take over!
The board had agreed and the staff had taken over management completely. It was still a trust but the staff had the right to dispose of any profits. They had recruited a couple of ambitious young financial analysts and gone ahead in a completely new fashion. In 1979 they had experienced three years of steadily increasing circulation and a small but increasing profit. They were twelve people altogether, eight of them were editors.
A kind of coffee table democracy with consensus as the basis for decision making had developed.
The company I arrived to in the autumn of 1979 was a very odd organisation indeed measured by my Unilever standards.
They had a board of directors, that had nothing to do with the business. The company was run by the staff as their own - but they did not own it. They had a managing director - an analyst/journalist - whose function was more like "the Chairman of the Coffee Table Conference". The Editor-in-Chief was also called "Secretary", the managing director´s title was never mentioned. But the journalists were called "Editors" (normally a manager´s title).
So, when I arrived I was hit by a severe culture shock. Nothing I had learned in the university, nor during my six years as a manager at Unilever had prepared me for a situation like this.
They had profit sharing. Still nobody interested in the organisation. Why? How could professionals in information be unable to handle their own internal information? Why did not all the great ideas and all the talk result in action? How could they translate a demand for action into thinking?
My first answer to the questions above was an intuitive action:
If nobody cares about what I am supposed to do, I suppose I will have to do what all
the others are doing.
So in the coming two years I changed my job entirely. I volunteered to write articles in Affärsvärlden. I recruited a new accountant and in 1982 we launched a new magazine, Ledarskap, Sweden´s first management weekly, and I joined as one of the editors.
But I was one of the three managing partners of our growing company and I could still not make out the answers to my puzzle. I became more and more convinced that we were "unique" (as indeed my fellow partners believed) so I used my position as an editor to write about topics that I believed could shed some light on my management puzzle.
One of the articles I wrote was about advertising agencies in 1983. The interviews fascinated me. I found that the managers in the advertising agencies experienced the same problems as I did in my own company. Why? Was there something universal about my own problems?
In the article I categorised employees according to whether they were involved in "professional" work or "organisational" work.
This seemed to give some clues to some of the questions I had.
I continued to research the issue by writing more about computer companies, mana-gement consulting firms, auditing firms, etc. In 1985 I collected my thoughts in a longer piece that became one of the two parts in a book together with a consultant, Anders Risling. I put the label "Kunskapsföretaget", ("The Knowhow Company") as the title of the book.
The book was launched in the spring 1986, the media got interested and soon the concept was on its way into the minds of people. The concept became a household name in Scandinavia and the success of the concept created a number of followers in Scandinavia.
In midst of the hype around the concept the journalist Göran Albinsson-Bruhner however, hit the head on the nail in an article in Svenska Dagbladet 1989:
When I started my job at (the newspaper) Svenska Dagbladet I was taught that it was a Publishing Company. A few years and a dozen management books later I was working in an Information Company. Now I am employed by a Knowhow Company. A career without even having to change employer! I so-metimes wonder whether the development only has happened in the heads of some authors.
He illustrates the way powerful metaphors steer our interpretation of the world. As soon as a concept is invented it takes on a life of its own. Once such an reification has taken place and there has become a reasonable understanding among actors on that "image", it becomes a shared object, "institutionalised" and no longer questioned. It becomes a part of our Tacit Knowledge, as Michael Polanyi puts it.
This applies to all concepts, like "Business Process Engieering", "Learning organization", etc.
The concept of the Knowledge Oeganization was born out of my own confusion in a diffcult management situation. I have since then done research and consulting to managers in such companies and I have found that the concept helps other managers address some of the specific issues involved in managing high powered people in fast oving industries, like computing, advertising, engineering, information. etc.
Read more about measuring knowledge and Intangible Assets or about the Knowledge Organization.