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Knowledge Workplace: Knowledge Management and Office Design
By
Office Design Reflecting the Times
As the shift to the knowledge society / economy continues to advance, it has been pointed out that the management organization model of the 20th century has not responded to this change. For example, there is no significant difference between an organization within NASA and a typical computer system. Both of them have vertically-segmented structures with different departments at each level. They have the same function of processing information. Organizations, let alone computer systems, have been designed to process information. Most organizations, mainly those in the manufacturing industry, have adopted this tree structure model. Organizational reforms have also been aimed at this organizational structure.
Among recent high-growth firms or firms which have successfully restructured their organizations, a number of them have broken free of the "spell of the conventional organizational chart." Nissan's Cross-Functional Team literally works cross-functionally. Oticon in Denmark, a knowledge management best practice company, is well-known for its spaghetti organization which accepts and tolerates chaos.
It is obvious that the basic logic for office design is still based on the concept of tree structure organization. The tree structure is comprised of different boxes which represent different departments. If the number of members belonging to one box is large, it occupies a large space in the office. A small space is given to a box with a small number of members. A meeting room is provided between different boxes for coordination. When laid out in a floor plan, it is to be expected that each box is allocated a single function.
Such organizations and offices became common because we were not able to (or deemed to be not able to) process a large amount of complex information at one time (H.A. Simon's cognitive limitation and bounded rationality explains this). Thus, a hierarchical organization was the most convenient when a firm was supposed to carry out many different tasks based on the division of labor. This applied to computer systems as well. If you divide what you have to do, the scope of each task is clarified so that it can be carried out promptly and efficiently. However, we have overly embraced this idea for designing offices and now must realize there are other approaches to office design.
Oticon moved its office to a factory building, and realized an organization and office with no walls which eventually became the pioneer of free-address offices. A global perspective shows that there has been a visible trend toward organizational reforms to respond to the knowledge society / economy through office design.
Implication in Shift to Knowledge-based Management (or Knowledge Management)
Let us now consider current office designs in terms of design codes (conventions and rules in design). As mentioned above, codes for processing information have brought out organizations whose structures have determined how offices look. Furthermore, they overlap with codes for designing computer systems. These two codes are dominant in current office designs. There exist no design codes for people. Although some ergonomic considerations have been incorporated in office designs, there have been no fundamental design codes from a people-based perspective about how we live and work. In short, current office designs are indifferent to people who work there.
It has caused serious problems. The Japan Productivity Center for Socio-Economic Development recently released a survey on mental health. According to the results of the survey, the number of workers with mental problems has increased over the last three years at 60% of all Japanese firms. Three quarters of all Japanese firms have workers who have taken one-month or longer sick leaves because of mental problems. Lack of communication and mutual cooperation, due to the current tendency of individuals carrying out business processes, is pointed to as a main cause.
In the field of IT, blogs have become a focus of attention because they allow linkage between individual bloggers working on the frontlines. This popularity of blogs seems to be a resistance to the above "trend of disconnection." On the other hand, quite a few firms have prohibited in-house blogs because they might cause confusion in existing systems. In this context it can be pointed out that we need new approaches to design as the conventionally dominant design codes are becoming invalid.
What firms need to do towards this purpose is an evolution into knowledge-based management, knowledge management in the broad sense. Knowledge management has been generally misunderstood as an IT-centered approach. The failure of knowledge management projects at many firms is attributable to this misunderstanding. As a result, knowledge management has a somewhat negative image for quite a few people. Knowledge management in the first place entails systems and tools for the development and evolution into the knowledge society / economy. After all, knowledge-based management, in which IT-based knowledge management in the narrow sense is included, all depends on how we can create and utilize knowledge assets, the most important assets to firms, systematically and effectively. And what underlies knowledge assets is the creation, sharing and utilization of knowledge by people (knowledge workers).
It seems rather difficult for Japanese people to realize the importance of knowledge because Japan's economic growth has centered traditionally on manufacturing industries. The knowledge economy has already replaced the real economy. As Alan Greenspan points out, "the economic products of the United States are mostly concepts now." It is said that three quarters of the economy is comprised of intangible assets such as programs, contents, licenses, solutions, designs and brands. It does not mean the end of manufacturing industries or poor productivity in the service sector. It means the arrival of a new era in which hardware (physical) products are marketable only when knowledge is embedded in them.
There are two aspects in knowledge-based management: transformation into a knowledge creating company, and profit making based on knowledge assets such as brands, solutions and licenses. In short, a knowledge creating company is an organization based on knowledge and innovation. One of the key strengths of Japanese firms lies in their art of making things. The essence of knowledge-based management lies in how knowledge can be created and utilized in an effective, systematic and strategic way (the art of making knowledge).
Ba for Knowledge Workers (Ba as Workplaces)
The protagonists in knowledge-based management are knowledge workers. There has been an increasing need for firms to see their employees as knowledge workers. It is notable, however, that white-collar workers and knowledge workers are totally different in concept. The main role of white-collar workers is to process business related-information. Therefore, they can be theoretically replaced with computer systems and are very vulnerable when firms slash payrolls. On the other hand, firms cannot simply cut their knowledge workers because they create knowledge that is the source of value.
While offices for white-collar workers reflect hierarchical relationships among them, ba is the key to the good performance of knowledge workers. Ba is defined as dynamic contexts or interactions shared by knowledge workers when creating and utilizing knowledge. What individual knowledge workers do through ba is to utilize networked knowledge or collective knowledge, not to do their task work based on the division of labor at their desks.
When building ba, we can reproduce or amplify contexts by use of IT. What is particularly important, however, is how we design our office. Ba entails not only physical spaces and IT but also cultural and cognitive factors (such as a work way).
Conventional office designs, based on space cost per person, put emphasis on pursuing efficiency in both information processing and cost. Offices basically were places to work. In knowledge-based management, offices are ba where the knowledge creation process takes place. Ba synthesizes all physical, cultural and cognitive factors that include office spaces, networks, communications, IT, work ways, organizational culture, and other contexts. It needs to be treated as a cognitive workplace, not as a simple office space.
DEGW, a British workplace design consultancy, uses a design matrix to analyze offices as ba. The axes of the matrix are worker autonomy and interaction. For organizations with high autonomy and high interaction, there need to be club-like places and functions. Offices for organizations with high autonomy and low interaction, such as those comprised of researchers, probably need some systems to facilitate interaction. For organizations with low autonomy and high interaction, like those for sales forces, ba for sequential sharing of frontline knowledge is crucial.
When designing an office, you must put great importance on knowledge creation through ba and the utilization of knowledge assets. What is necessary for the former includes systems to allow constant creation of knowledge and interactions to turn tacit knowledge into explicit knowledge. Some firms have already designed their offices based on the knowledge creation process.
If we take the latter into consideration as well, we have to think about office design from a more comprehensive perspective as an issue that concerns the entire organization. The organization here means one large system that covers not only factors and functions within the firm but also its partners and customers. In this case, the containers of ba are not concentrated in offices and are more distributed. Consequently, we have to have a totally new perspective on spaces and tools for work. While we should consider incorporating some office functions into the city, we also need to see our office not as a place exclusive to the employees of the firm but as a hub of a large business network. For example, there is an emerging trend of seeing office sites as "knowledge campuses" mainly in Europe.
| Traditional Office | Knowledge Workplace | |
|---|---|---|
| User Model | White-collar workers | Knowledge workers |
| Role | Space for carrying out business tasks, place for individuals to stay | Ba for creating and utilizing knowledge |
| Utilization Pattern | Commute to the office | Utilization of spaces around the office or telecommuting |
| Structural model / Space layout | Tree structure / Island layout | Multi-layered ba / dynamic layout |
| Function | Single function, division of labor | Multidimensional functions, networks |
| Design Code | Information processing / computing | Quality of knowledge clusters in and among organizations and people |
| Design Method | Floor planning | Ba diagramming |
| Treated on the Balance -Sheet as: | Cost | Investment |
Hindrances to Knowledge-Based Workplace Approaches
Firms have designed their offices for administrative work based on the tree structure model and the island layout (with four desks arranged to form a square as the basic unit) since the 19th century. Thanks to the widespread availability of IT, however, we no longer need to arrange desks in that way for group work. In fact, adherence to this conventional design model may cause people to miss business opportunities. On the other hand, an increasing number of firms in different countries have been successful in adopting cutting-edge, knowledge-based approaches to workplace design. In this context, the validity of making efforts for designing effective knowledge workplace seems self-evident. However, there are a very few Japanese firms who have put strong emphasis on office (workplace) design. Then what prevents Japanese firms from adopting knowledge-based workplace approaches?
1) Too Much Emphasis on Productivity:
This is attributable to a culture peculiar to Japanese manufacturing industries based on the logic that having a strong motivation is much more important than having a good office. The strong belief in productivity behind this -- "High productivity excuses everything" -- lacks a comprehensive perspective on workplace. According to this, the importance of offices is not so great. The smaller balance sheet value the better as far as offices are concerned, while investments in offices absorb a large percentage of the corporate budgets as those in IT do. As DEGW points out, however, investments in offices are very likely to result in more effective investments in IT. In other words, building effective ba leads to the improvement of the quality of IT literacy and interfaces.
2) Superficial Adoption of New Trends
"Free address" offices have recently become a focus of attention in the field of office design. This trend focuses on reflecting the knowledge creation process in office design. However we will not reach our desired outcome if we simply adopt the trend in a superficial way. BBC News recently reported on "Shrinking Office Syndrome." The article suggests that the popularity of more flexible, open office layout models such as that for free address offices has set a trend toward less space per employee in office buildings. Overcrowded open-plan offices can make people frustrated and less motivated, and offer a long-term threat to business performance.
3) Inadequate Understanding of Software (Intangible) Aspects of Workplace
When we have to go to a hospital, what we really need is not its hardware (tangible) aspects such as its building but its software (intangible) aspects including medical practices and services offered there. This is also true with schools. A school is something more than a classroom and desks arranged therein. The same thing applies to offices as well. However we tend to center on hardware (tangible) aspects when it comes to designing offices. Therefore, we need to call offices "workplaces" when thinking about concepts for them.
4) Inconsistency Between Office Design and Business Strategy
Quite a few companies have left office-related problems, regardless of whether their offices are newly built or renovated, to their general administrative divisions. Therefore, they need to make their general administrative divisions regard office designs as something more than desk layouts and have a more strategic perspective on their designs, or involve their management planning divisions in processes to build concepts for their workplace. Many people argue that it is the top management who should have a philosophy in designing offices before anything. The author believes, however, top executives at many firms understand the importance of offices and have their own philosophies on how their offices should be designed. It seems that the major problem lies in middle managers who take the leadership in making such philosophies work in the real world. A large number of office projects thus far have been hindered by such political factors.
5) Little Awareness of the Importance of Office Design Among Existing Players
Design of office interiors has been regarded as an area of little importance by architecture departments of many universities. Students are usually taught that designing larger projects such as museums and other cultural facilities is much more significant. Recognized as an area representing industrial design with its main focus on efficiency, the symbolic aspect of their exterior designs have only been emphasized. As a matter of fact, the interior spaces of many office buildings designed by world-famous architects have a number of problems as workplace. Therefore, the significance of office design needs to be recognized more widely as a discipline for designing ba within offices. As an increasing number of architects and furniture makers have recently become interested in ba, it is quite probable that the current situation will change eventually.
In closing, it is notable that ba, a concept reflecting clearly the Japanese perspective, is getting widespread international attention. It is a major challenge for Japanese firms focusing on knowledge-based management to reconsider ba and design global workplace with Japanese elements.
