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27 October 2009
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30 October 2009
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Knowledge workers fuel innovation and growth, yet the nature of knowledge work
remains poorly understood—as do the ways to improve its effectiveness. The heart of
what knowledge workers do on the job is collaborate, which in the broadest terms
means they interact to solve problems, serve customers, engage with partners, and
nurture new ideas. Technology and workflow processes support knowledge worker
success and are increasingly sources of comparative differentiation. Those able to use
new technologies to reshape how they work are finding significant productivity gains.
This article shares our research on how technology can improve the quality and
output of knowledge workers.
Comment on the debate
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McKinsey on business technology
Knowledge workers are growing in numbers. In some sectors of the economy, such as
healthcare providers and education , they account for 75 percent of the workforce; in
the United States, their wages total 18 percent of GDP. The nature of collaborative
work ranges from high levels of abstract thinking on the part of scientists to building
and maintaining professional contacts and information networks to more groundlevel problem solving. Think of a buyer for a retail chain whose distributed web of
contacts span fashion designers in Tokyo to experts on manufacturing in Brazil.
McKinsey's Lenny Mendonca
discusses on Big Think, a global
online forum, how technology is
catalyzing business successes—and
failures.
For companies, knowledge workers are expensive assets—earning a wage premium
that ranges from 55 percent to 75 percent over the pay of workers who perform more
basic production and transaction tasks. Yet there are wide variations in the
performance of knowledge workers, as well as in their access to technologies that
could improve it. Our research shows that the performance gap between top and
bottom companies in collaboration-intense sectors is nine times that of production-
31 Oct 2009 · 06:26:09 AM GMT
or transaction-intense sectors. 1 And that underscores what remains a significant
challenge for corporations and national economics alike: how to improve the
productivity of this prized and growing corps of workers (Exhibit 1).
A good collection and explanation
of the principal about tacit
knowledge and the fundamentals to
convert it into explicit one.
—Sameer Muntode
In response to Using technology
to improve workforce
collaboration
31 Oct 2009 · 04:24:20 AM GMT
Wow, what a wonderful marriage of
business with technology! In other
businesses, inspite of enormous
scope, adaptation of technology is
unfortunately not keeping pace with
technological innovations. Unless
businesses adopt the “outside in...
—Nitin K. Parekh
In response to Zipcar: selling
cars, one ride at a time
30 Oct 2009 · 04:13:21 PM GMT
CC is a collaboration enabler that is
exemplary in this era of digital
revolution. It allows content to flow
legally with ease,which has been
hitherto obfuscated by antidiluvian
copyright laws and procedures
—Abdul Mobeen Khan
http://whatmatters.mckinseydigital.com/internet/using-technology-to-improve-workforce-collaboration[10/31/2009 9:24:44 AM]
McKinsey: What Matters: Using technology to improve workforce collaboration
In response to Creative
Commons: Enabling the next
level of innovation
30 Oct 2009 · 11:42:53 AM GMT
Unfortunately, the productivity measures for collaboration workers are fuzzy at best.
For production workers, productivity is readily measured in terms of units of output;
for transaction workers, in operations per hour. But for knowledge workers, what
might be thought of as collaboration productivity depends on the quality and
quantity of interactions occurring. And it’s from these less-than-perfectly-understood
interactions that companies and national economies derive important benefits.
Consider the collaborative creative work needed to win an advertising campaign or
the high levels of service needed to satisfy public citizens. Or, in a similar vein, the
interplay between a company and its customers or partners that results in an
innovative product.
Raising the quality of these interactions is largely uncharted territory. Taking a
systematic view, however, helps bring some of the key issues into focus. Our research
suggests that improvements depend upon getting a better fix on who actually is doing
the collaborating within companies, as well as understanding the details of how that
interactive work is done. Just as important is deciding how to support interactions
with technology—in particular, Web 2.0 tools such as social networks, wikis, and
video. There is potential for sizeable gains from even modest improvements. Our
survey research shows that at least 20 percent and as much as 50 percent of
collaborative activity results in wasted effort. And the sources of this waste—including
poorly planned meetings, unproductive travel time, and the rising tide of redundant
e-mail communications, just to name a few—are many and growing in knowledgeintense industries.
There are some companies that already are tackling aspects of this collaboration–
technology nexus. Cisco Systems, for example, set out to improve interactions
between its technology specialist sales teams and enterprise customers. Frequent
travel and stepped-up job requirements had resulted in overstretched teams whose
effectiveness had become diminished. Cisco tackled the problem by mandating the use
of its own video technologies, as well as other collaboration tools. The plan was
straightforward: reach more customers and business partners by shifting a large
portion of in-person meetings to virtual interactions. Policy and governance changes
ensured that technology use became part of daily workflows and not an added task.
Over an 18-month period, the initiative saved Cisco more than $100 million in travel
and business expenses and reduced the company’s carbon emissions by 24 million
metric tons. Internal surveys showed that 78 percent of the targeted employees
reported increased productivity and improved lifestyles without diminishing customer
or partner satisfaction.
Similarly, P&G has also adopted Web-based technologies to forge better links with
partners and customers and to improve the flow of ideas across corporate and
regional boundaries. It also set up ideas markets to gather and filter offerings from
http://whatmatters.mckinseydigital.com/internet/using-technology-to-improve-workforce-collaboration[10/31/2009 9:24:44 AM]
Gentlmen “Knowledge worker” is, of
course, a concept introduced by
Peter Drucker. You kindly provided
your definition so, as a contribution
to the discussion, here’s ours and
why we think they are so important.
Knowledge workers p...
—P. Wayne Reagan
In response to Using technology
to improve workforce
collaboration
30 Oct 2009 · 11:17:04 AM GMT
please check this site. this was a
congress in the summer about
creative commons. http://colognecommons.de/
—Dietrich
In response to Creative
Commons: Enabling the next
level of innovation
30 Oct 2009 · 10:05:21 AM GMT
The article is very interesting and in
gerneral I can agree to its content.
When I consider this from a global
point of view the content of course
is still valid. Never the less other
countries have totally different
culture and way of
communication...
—Rainer
In response to Using technology
to improve workforce
collaboration
All Things Digital
Business and Web 2.0: An
interactive feature
Clay Shirky's Internet Writings
Digital Media Wire
Journalism Online
McKinsey Quarterly on Business
Technology
Mediabistro
Neiman Journalism Lab at
Harvard University
Paidcontent.org
Poynter Online
McKinsey: What Matters: Using technology to improve workforce collaboration
across the company and signed on with crowd-sourcing network InnoCentive to tap
external experts to solve specific problems. In addition, the company used a
collaboration strategy to broaden its product offerings and get more of them to
market at a faster pace. It set a target of raising the proportion of new products
sourced from outside its walls to 50 percent, from 35 percent. Besides the savings
P&G realized from nearly a thousand fewer business trips each month, the company
met its goals of shorter product cycle times and greater product innovation from
external sources.2
But most companies are only beginning to take these paths. That’s because, in many
respects, raising the collaboration game differs from traditional ways of boosting
productivity. In production and transaction work, technology use is often part of a
broader campaign to reduce head counts and costs—steps that are familiar to most
managers. In the collaboration setting, technology is used differently. It multiplies
interactions and extends the reach of knowledge workers. That allows for the speedier
product development found at P&G and improved partner and customer intimacy at
Cisco. In general, this is new terrain for most managers.
IMPROVING COLLABORATION
The interactive graphic that accompanies this article provides a synthesis of our view
on how organizations can improve collaboration. It draws upon our work with
companies, non-profit organizations as well as our own research and that of outside
sources. The graphic’s multilevel approach to improving collaboration is based on the
following steps:
1) classify workers by their workflow profile – the daily activities they do to perform
their job
2) match new technologies to the workflows to extend collaboration efforts, improve
effectiveness, and reduce inefficiencies
Click the image above to launch the interactive in a new window.
The discussion that follows is both a guide to the interactive and an elaboration on
the thinking behind it.
Defining knowledge workers and how they work
As a first step, companies should take a fresh look at their workers, classifying them
by how they collaborate. We have identified 12 types of collaboration work (see the
interactive exhibit, “Collaboration types and tools”). Each of these is broken down into
the day-to-day interactive activities (or workflows) that comprise these work classes.
Today most organizations segment their employees by their positions within the
corporate hierarchy. They are identified by job titles that, in many cases, obscure the
kind of work they actually do. Take the title of manager. Seen through a collaboration
lens, this title is often applied to several different collaboration types: in some, a
manager builds teams, develops team members’ expertise, sets objectives, and
encourages results; in others, a manager is more of an administrator who repeatedly
http://whatmatters.mckinseydigital.com/internet/using-technology-to-improve-workforce-collaboration[10/31/2009 9:24:44 AM]
Twitter/McKQuarterly
McKinsey: What Matters: Using technology to improve workforce collaboration
executes processes (such as monitoring the work of others) to a certain standard.
Many companies also award the title of manager to the consultant collaboration type
– individual contributors who convene or take part in virtual teams to solve
problems. Thus, improving collaboration should start with understanding employee
workflows to get a more refined view how their work gets done.
At the same time, functional groups—such as sales and marketing, finance, and
strategy—within organizations often divide into an array of job classifications that
multiply over time. Yet these classifications don’t reflect the interactive aspects of the
work. In our experience, jobs within many functional organizations can be grouped
into a small number of collaboration types that reflect such interactions. This
simplifies the task of improving collaboration. Take the case of one sales organization,
where work was splintered into 50 distinct roles. Using interaction requirements as
our guide, we found these roles reflected three basic collaboration types: sales people,
managers, and administrators. In most sales organizations, each type of sales job is
distinct and siloed: employees doing telesales and enterprise sales are given distinct
corporate job codes and internal classifications, because they may have somewhat
different skill sets. But the process workflows of these jobs are essentially the same—
employees receive sales plans or quotas from management, build account plans, and
generate and act upon sales leads, etcetera.
Applying technologies
Improving employee collaboration also depends on selecting the technologies that
support their interactions. Companies can best do this by 1) understanding the
specific requirements of interactive tasks; 2) identifying which tasks create
disproportionate value for the organization; and 3) determining the types of
inefficiencies and wasted efforts that bog down many interactions.
Requirements. Even within a given group of collaboration workers, the required
interactions and technology solutions may vary substantially. For example,
collaboration between two individuals working together on an account plan is very
different from that of several dozen individuals meeting to coalesce around a sales
strategy. Collaboration work, we have found, varies over a dozen such dimensions—
including the scope of the collaboration (number of parties involved), which way
information is flowing among the participants, whether participants exchange
information equally, and whether the interactions stretch across functional or
corporate borders. We examine these dimensions when assigning technologies to
collaboration workflows.
Value. Not all interactions are created equal. Some organizations will prioritize focus
on collaboration types and even specific activities based on their relative contribution
to the organization’s objectives. For Cisco, this means a strong focus on partner and
customer intimacy. For P&G, it is about increasing access to new ideas and speed to
market. Other common objectives for collaboration initiatives include better talent
management, business agility, and a reduced carbon footprint. Imagine the economic
benefits for organizations able to double the number of inspired employees or triple
the volume of new product releases.
Waste. We have documented 10 types of collaboration waste (Exhibit 2). In the case
of managers, for example, effective collaboration demands that the manager not only
agrees on specific objectives but also that he /she can communicate how to achieve
them. Those efforts can be undermined by divergence (for example, sending teams in
different, conflicting directions), misunderstanding (for instance, gaps between the
message communicated and the resulting execution), and under- or
overcommunicating, as well as other types of flawed interactions.
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McKinsey: What Matters: Using technology to improve workforce collaboration
Web technologies can diminish the wasted efforts. Take the case of “searching”:
inefficiencies arise when a staffer is unclear about which colleague within the
organization may be tapped for specific knowledge to solve a problem. One remedy is
network mapping, a technology that plots work relationships among individuals,
reducing search time by providing insights into the pools of knowledge within the
company,
Meanwhile, as more of knowledge workers’ output involves digital content, other
forms of waste multiply. Fact checking, annotations, and edits lead to handoffs and
serial revisions that we term “interpretation” waste. Similarly, as this digital
information often must serve audiences across distribution channels—printed
documents, PowerPoint slides, and videos, for example—inefficiencies arise from
“translation.” At times content is needlessly reworked or even distorted as it crosses
channel boundaries. Collaboration technologies such as Google Docs, Adobe’s
Acrobat.com, or Microsoft’s OfficeLive allow for coauthoring and co-editing content
documents. Since parties are frequently tackling the same project at the same time,
translation and interpretation waste is reduced.
From our research on workflows across a variety of companies we are able to arrive at
benchmarks for the most effective way of performing a task. With that knowledge we
can identify inefficient practices and select technologies with which to improve them.
MOVING FORWARD
Furthering collaboration excellence demands mind-sets and capabilities that are
unfamiliar and sometimes even counterintuitive to many business managers. It
requires trusting your collaboration workers to arrive at creative solutions rather than
enforcing top-down policies. Business managers should allow time and provide
forums for collaboration workers to brainstorm solutions to productivity problems.
Corporate technology providers will need to provide tools that are flexible enough to
enable experimentation, so that usage and adoption are widespread.3
While the broad gains from better workforce collaboration have been apparent for
some time, the management approach and tools needed to capture the benefits at the
company level have been missing. By using the methodology outlined here,
companies can improve productivity among the growing ranks of their knowledge
workers.
1
This was measured as the average earnings before income, taxes, depreciation and amortization per
employee.
2
Larry Huston and Nabil Sakkab, “Connect and develop: Inside Proctor & Gamble’s new model for
innovation,” Harvard Business Review, March 2006, Volume 84, Number 3, pp. 58–66.
3
Michael Chui, Andy Miller, and Roger P. Roberts, Six ways to make Web 2.0 work, September 2009.
Jacques Bughin, Michael Chui, and Andy Miller, How companies are benefiting from Web 2.0, September
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McKinsey: What Matters: Using technology to improve workforce collaboration
2009.
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Comment [16]
Agree? Disagree? Let us know what you think. Please include your full name with your
comment. Comments may be edited.
1 2 >>
A good collection and explanation of the principal about tacit knowledge and the fundamentals to convert it
into explicit one.
Posted 31 October 2009, 06:26 by Sameer Muntode
Gentlmen
“Knowledge worker” is, of course, a concept introduced by Peter Drucker. You kindly provided your
definition so, as a contribution to the discussion, here’s ours and why we think they are so important.
Knowledge workers perform non-repetitive, non-routine work that entails substantial levels of cognitive
activity. The work of professionals and specialists, knowledge work is enabled by computers,
telecommunications and robotics. As a group, knowledge workers are the single most important force
determining corporate productivity in the Information Age. They are unlike any group that existed in the
Industrial Age. Because of their novelty, the precedents for their care and feeding simply did not exist.
What is clear is that knowledge workers cannot be managed into information cultures, they must be led.
Information cultures require new types of executives. In the functional hierarchy of the industrial economy,
patterned after 19th century military organizations, managers were bosses and exercised formal control over
everybody else as subordinates. However, in the new networked organizations, knowledge workers really
are the bosses while managers support them as planners and coordinators. In stark contrast to labor
cultures, the modern measure of productivity — optimum yields — has become quality of output rather than
quantity. For example, the Internet’s ability to move information instantaneously and cheaply makes it
possible to push decisions down to the level of the individual (or, at least, the individual operator of a
computer). This capability makes it possible to imagine making a market out of almost anything.
For these reasons, the critical factors in guiding knowledge worker productivity — such things as attitudes,
adequate information, work flow, job relationships and the design of jobs and teams — really are people
issues. Knowledge workers require executives with the leadership skills to guide them, and the technical
skills to understand them, not simply the management skills to control them. They require leaders who can
evaluate evidence, construct arguments, and empathize with people, whether a thousand years ago, or
10,000 miles away, or even in the next room. Leaders who will say to workers “hold on now” — get them to
back up, fill in the gaps, lay out the context, and open up their story so it begins to yield its own solutions.
But most of all they need leaders who have learned to read well and write clearly, so that they will not
always be prey for those who do!
At the end of the day, knowledge – the product of the “mind-sets and capabilities” — is the expression of the
skills the workers possess and how indelibly linked those skills are to those required to accomplish
corporate goals. This means evolving a system that dynamically sequences and then maps the skills on
both sides of this complex and constantly changing equation. For these reasons, your analysis of the
mechanism of collaboration productivity is an important contribution to the field.
Posted 30 October 2009, 11:42 by P. Wayne Reagan
The article is very interesting and in gerneral I can agree to its content.
When I consider this from a global point of view the content of course is still valid. Never the less other
countries have totally different culture and way of communication which need to be considered when
collaboration tools are implemented. The collaboration and way of communication of people in Asia, Europe
and South and North America is totally different.
I am working with international virtual teams and inspiring the collaboration among the team members is one
the most challenging part of my work. Compare to US and Europe Asians are very agile and flexible. US
knowledge worker think they are the center and define the direction whereas Europeans are very
conservative and careful. Unfortunately a tool doesn’t help to eliminate these differences nor does it help to
improve the communication. Only a good leader of the team can break down the barrieres of communication
and motivate the team members to communicate open and frank by using a collaboration tool.
The human factor is much more important than the tool when it comes to communication and collaboration.
Posted 30 October 2009, 10:05 by Rainer
http://whatmatters.mckinseydigital.com/internet/using-technology-to-improve-workforce-collaboration[10/31/2009 9:24:44 AM]
McKinsey: What Matters: Using technology to improve workforce collaboration
Great article and maybe the title should be ‘Creating new leadership to improve workforce collaboration’!?
Several point out the importance of the right culture and leaders set the frame for this of course.
The right culture to share knowledge and collaborate will rarely permeate to the levels required where there
is a over-reliance on individual performance rewards. Giving this up/relaxing it can be a courageous step,
but as the article infers, potentially far more rewarding both in terms of productivity gains, innovation – and
no doubt, personal motivation and well being.
I suggest leaders will need to measure their culture and employee perceptions on productivity – even
subjective assessments on this can become objective if there is sufficient mass.
Posted 30 October 2009, 04:04 by John Williamson
I liked many parts of the article and I certainly use parts of it to support an already strong business case.
I would like to see an acknowledgement of collaboration not just being driven through technology. The drive
to a collaboration/innovation culture becomes stronger by involving HR to stimulate ‘participation’ during the
appraisal procedures. Hence the approach has a major impact on the outcomes.
Innovation is on the agenda on most companies today. No doubt that a good collaboration platform can help
to serious boost innovation … at at least capture more ideas and manage those ideas efficiently.
We do all what you write about … and more. It works and creates a lot of value to the company.
Best regards,
Michael Aandahl
Business IT Manager of SCA Packaging
Posted 30 October 2009, 03:06 by Michael Aandahl
Very interesting article. The section on Waste has been particularly very well worked.
Posted 30 October 2009, 02:53 by Sarabjeet Singh
Great article !! I like the insights. However internal barriers (cultural or otherwise) influence the successful
knowledge sharing directly. Unless they are recognised and addressed, the model will not function as
efficiently.
Posted 30 October 2009, 01:20 by John Mathew
Isnt all this known?
In my opinion, this is a repetition of what is known. What would be interesting to know is – how do you
measure RoI on using collaborative solutions? – Can this be used as a case for developing nations like
India- where technology adoption is slower than their counterparts in the West.
Dhiraj Khot
[email protected]
Posted 30 October 2009, 01:19 by Dhiraj Khot
Thank you for the comments. In our research we found the culture point facinating. Consider a few trends
shaping the big company cultural mosaic:
(1) Generational mix of leaders – today we see an imprint of non-internet executives, internet savvy, and
social media kids turned young execs. The style and preference of how to communicate are rapidly
changing as are the expectations of what it means to be connected.
(2) Consumer-led workplace – our experiences as consumers affects our exepctations of a good work
environment. With smartphones and interactive tools to communicate with friends – employees are
increasingly demanding these capabilities at work
(3) Evolution of corporate policies – we are seeing communication policies evolve – even things as basic as
what is allowed in the firewall and out. No question this is a challenge for CIOs and COOs alike.
(4) By example – - culture changes as cultural leaders change. Recently a senior executive client told me if I
wanted to learn more to check out her Twitter! She was right!
Posted 29 October 2009, 23:48 by Lareina Yee (author)
Very good overview on collaboration and how it is now widely accepted. I was employed several years ago
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McKinsey: What Matters: Using technology to improve workforce collaboration
by one of the world’s first collaboration software vendors and we had a difficult time convincing Fortune 500
companies as to the need for collaboration. Now they are embrassing this technology. However,
collaboration is a “piece of the puzzle” and I now am now with a company which is involved with the
Enterprise Content Management(ECM)technology, which has colloaboration and data warehousing as
“components” of an overall structure to provide global collaboration, business intelligence (BI) and document
sharing, with check-out/check-in capabilities, to allow corporate knowledge workers, vendors and business
partners to share their knowledge. As an example, in banking applications, a loan app is received, scanned,
sent to India for processing, sent back to the USA for finalization, credit checking and other processes.
Many people need to have access to this application and interact with it prior to approval/rejection. It is
important to look at the “big picture” and develop an architecture which will support this picture.
Posted 29 October 2009, 21:56 by Stanley Bailey
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