Michael D. Moberly March 12, 2012 (Book review with application to intangible assets.)
The persistent, asymmetric nature, and shear number of risks, challenges, and problems that companies routinely face today with respect to their intangible (IP) assets are not always reflected or addressed in conventional employee – management team training models which tend to ‘push out pre-built training’.
Conventional training methods and how they’re delivered may not be especially well-suited for knowledge (intangible asset) intensive businesses. Exacerbating this is the go fast, go hard, go global, ultra-competitive, and predatorial business environment in which growing numbers of companies operate.
John Hagel, as most readers recognize, is a respected business consultant and author of ‘The Power of Pull: How Small Moves, Smartly Made, Can Set Big Things in Motion’ along with co-authors John Seely Brown and Land Davison.
‘The Power of Pull’ describes the very real shift in power, which we’re now in the midst, according to the authors. The ‘pull’ approach essentially creates circumstances which I would describe as being akin to a company culture or knowledge management program in which the right people, the right resources, and the right (relevant) knowledge (information) is easily and quickly ‘pulled’ together whenever and wherever its needed, to effectively meet a current demand or address a problem or challenge.
Too, the ‘shift’ the authors refer to is due in part to the continually evolving knowledge (intangible asset) based global business economy wherein today 65+% of most company’s value, sources of revenue and ‘building blocks’ for growth and sustainability lie directly with intangible assets.
Hagel believes conventional models for delivering company training are largely outdated and less relevant which may come as no particular surprise too many because conventional training:
- tends to focus on the acquisition of knowledge that is already explicit and codified within a company and amongst its employees.
- does not instill a (business) sense of anticipation, i.e., determining what training – information employees will need and when?
- is well behind ‘the need’ curve, therefore little, if any, benefit will emerge to either a company or its employees if the same (push) delivery model continues.
Hagel’s ‘pull’ approach to training allows employees to quickly access relevant resources (information, knowledge, etc.) precisely when they need it, something which Hagel likens to the Google search engine.
Unfortunately, Hagel notes, the primary training model many companies still use is one that pushes, rather than pulls so the authors advocate companies should be building and utilizing ‘pull platforms’ for employees to access – acquire knowledge.
Another un-flattering reality Hagel notes, is that many companies continue to use a training (employee knowledge acquisition) model that does not include the ability to correctly anticipate (predict) when and how the need/demand for new knowledge will evolve in a company or quickly organize – bring the information together to accommodate the anticipated demand.
Hagel adds the need and demand for new information to solve/address a problem or challenge is frequently subject to internal miscalculations in terms of timeliness and accuracy of the information even though much of the needed knowledge – information is open source.
Companies should give favorable consideration to developing (internal) ‘pull platforms’ to accommodate that increasingly frequent and seemingly instantaneous need which, there’s little question, has become the norm for a large percentage of companies globally.
In a ‘pull platform’ as articulated by Hagel and his colleagues, the internal development of talent, knowledge, and expertise emphasizes, or perhaps is dependent upon (a.) on-the-job learning and other informal (learning) structures rather than (b.) conventionally produced (pre-built) and delivered training program.
In other words, ‘pull learning’ provides employees with the ability to rapidly confront the challenges-problems they’re experiencing through their ability to draw and/or pull out the resources needed to design-develop solutions whenever and wherever they’re needed.
Essentially, under the ‘pull technique’ employee learning becomes a by-product of the problems and challenges they encounter coupled with ever increasing requirements for measuring performance. I suspect, and Hagel confirms, as companies take the ‘pull strategy’ more seriously, they will begin re-thinking many of their conventional practices, e.g.,
- how the organization is designed
- what kind of business strategy should be pursued, and
- what kind of technology platforms are necessary to support the company and their employees in a work environment.
In addition to developing learning platforms that enable – facilitate ‘at will – on demand’ (employee) learning, moving to a fully ‘pull’ mindset approach requires, in many instances, redefining leadership. Simply stated, in a ‘push’ world, company leadership develops a program and enlists others to follow it.
Whereas, in a ‘pull’ world, Hagel claims, it’s about helping employees develop relevant capabilities to become leaders in their own context, i.e., business unit, etc. The goal is when employees engage an unexpected challenge or problem and are seeking, or in need of, a solution, they will have already acquired the necessary initiative and inquisitive disposition that encourages them to engage, not sidestep, the problem and find creative solutions to address – overcome it and, in the process learn from the experience.
Hagel sites three factors that are largely responsible for enabling and supporting the evolution of a ‘pull’ environment:
- digital technology
- economic liberalization, and
- global competition.
Hagel suggests everything accelerates in terms of the pace of change in today’s business environment including uncertainty (risk) because, among other factors, new participants (players) have more opportunity to enter a market space and build scale very rapidly.
For further proof of the shift from push to ‘pull’, Hagel points to the long-term decline of return on (physical – tangible) assets for public companies. Since 1965, return has gone down significantly and there are absolutely no signs this trend will reverse itself in the foreseeable future. Replacing that of course, as previously stated, is the economic fact that today, steadily rising percentages (65+%) of most company’s value and sources of revenue evolve directly from intangible (non-physical) assets. For Hagel, this represents ‘a huge red flag’ and all the more reason that the conventional ‘push’ strategy is no longer viable and should be changed.
All that said, many companies still don’t ‘get it’ and thus continue to hold on to the conventional practices and institutions associated with the ‘push’ business world even though it’s yielding diminishing performance.
Creating a proprietary library or body of knowledge in companies, for example, is often bound to fail Hagel argues, because they essentially keep companies and their employee’s knowledge and expertise (intangible assets) in a holding pattern of sorts. Too, such conventional approaches do not recognize most company’s value and revenue sources have shifted from tangible assets to intangible assets, i.e., intellectual and relationship capital, unique know how, and the ability to know when, how, and where to apply (use) such know how.
Instead, Hagel asserts, companies should focus on creating effective and efficient knowledge ‘flows’, e.g., the pull world, that allows employees to not only learn faster as the need arises, but also continually replenish their knowledge stocks, i.e., a company’s internal library if you will, of intellectual capital and unique know how (intangible assets).
A glaring reality today to Hagel’s work is that many things we come to know, at any one point in time, tend to become less useful or perhaps obsolete, given the rapidity of change in business circumstances and conditions. He also claims, if all a company does is hold on to what it already knows and tries to defend it and extract value from (monetize) it, it’s likely to be a losing proposition.
In the current and increasingly aggressive, globally competitive and predatorial business (transaction) environment it’s essential for companies and their management teams to continually seek and find ways to engage (participate) in the diverse and expanding array of knowledge flows. Absent that, Hagel believes, we will surely see more companies falling by the wayside, in many instances because they simply had less capability or inclination to compete in a global marketplace.
Hagel also believes, and so do I, that some of the most profound learning opportunities may not actually occur within a company, rather at the edges of company operations and transactions, e.g., the structural capital found through relationships with partners, stakeholders, distribution channels, and supply chains, etc. In other words, building and sustaining external relationships (structural-relationship capital) are two important strategies to consistently and favorably affect a company’s value, profitability, and sustainability.
So, while it may not be solely about (developing) talent within a company, it may be about a company’s foresight and ability to connect ‘talent with talent’ wherever it is, and build the relationships (structural, intellectual, and relationship capital) so talented employees can learn faster and better together. And, I can’t agree more.
This post was dually inspired by the work of Mike Prokopeak in his article in Chief Learning Officer magazine (August 18, 2010) and John Hagel, John Seely Brown, and Land Davison’s book ‘The Power of Pull: How Small Moves, Smartly Made, Can Set Big Things In Motion’.