Articles: Learning Consortia Work!

Extracting True Value from Learning Consortia

 With winter reading a consideration, this longer-than-usual Blog on Learning Consortia is worth the read.  It first appeared in the January 15th, 2015 ATJ CME eLetter.  It is reprinted here in light of our continued economic uncertainty – and the value Consortia have contributed to help cope companies in challenging times.  Forbes Magazine Contributor, Steve Denning,  contacted ATJ because of the value he’d seen added to Learning Consortia in knowledge environments  (Environments into which manufacturers are being propelled).  Steve contacted ATJ to learn how manufacturers were using the power of Consortia.  The result was the following interview Steve did with your editor.


Why Learning Consortia Work

By Steve Denning, Contributor, Forbes Magazine

That question I frequently get in discussions of the Learning Consortium for the Creative Economy, now being explored by Scrum Alliance and the Center for Innovative Cultures, as discussed here. I generally respond by drawing on the experience of other learning consortia, including my own experience in knowledge management.


Learning Consortia in Knowledge Management

In the early days of knowledge management in the 1990s, I was involved in several learning consortia. I found them extremely helpful. At the time, I was director of knowledge management at the World Bank and we were just getting started. It was extremely helpful to go and visit other organizations and see what they were doing and what was working and what wasn’t. Some of the things that were said to be very promising turned out to be less so when you got there and talked to the people who were doing the work. There were other site visits that initially seemed less promising, but when we saw what they were actually doing, it was extremely exciting. We adjusted our program in the light of these findings.

For instance, at the World Bank, we had started out with the idea that knowledge management would mainly be about “knowledge collections”, i.e. data bases of knowledge objects .But it turned out that it was much more productive to focus initially on “knowledge connections”—connecting people who knew with those who needed to know. As a result of this discovery, we shifted our whole focus.

In the site visits in these learning consortia, there was also a huge amount of interaction going on amongst the participants during the visit. We learned as much “on the bus” to the site talking to the other participants as we did on the actual site visit. There would be questions like “Are you trying this?” and “What happened when you did that?” Simply bringing together companies who were facing the same kind of challenges, trying to do the same kinds of things, and sharing with each other what their experience was, what was working and what they were having difficulty with, was immensely helpful.

It wasn’t only the site visits to other firms that were helpful. It turned out to be very useful for the World Bank to be chosen for one of the site visits. When whole groups of companies came to see what we were doing, they received some presentations but more importantly, they interacted with the many communities of practice that had sprung up. The visit also forced us as an organization, including the top management, to get our own act together and agree on what we were doing in knowledge management. The site visit thus helped inform our own top management what was going on. The fact that the World Bank was chosen for a site visit thus helped in strengthening credibility for our efforts, both inside the World Bank with the top management and externally in terms of enhancing the World Bank’s brand.  So these learning consortia were win-win solutions for all of the partners involved.

The Need for a Conversation Space

In coping with these changes, managers are finding that there are not many forums available to exchange ideas with other companies that are going through similar transformational changes. These matters are discussed to some extent in conferences. But in an open setting in the presence of media and journalists, the discussion stays on the surface. It is difficult to go into more depth and exchange views and experiences, and lessons learned. Moreover many of the participants at such conferences are there trying to sell their services, rather than having a conversation about what’s being learned in the course of the transformational journey.

Thus conferences can be valuable in terms of presenting a brand and demonstrating progress already made, which has some PR value. But managers are finding that such conferences don’t offer much help when it comes to difficult decisions that we are faced with, on issues that can be discussed openly and honestly and in a humble way. This includes learning from failures as well as how to deal with things like convincing top management to be investing in these new approaches, when there is a lot less than one hundred percent certainty of success and the innovator’s dilemma of the new business undermining the existing business. How are these transformational management practices to be reconciled with ongoing systems and processes that were developed for a different kind of business?

Those kinds of conversations don’t typically happen in a large public forums. If there are many people present, it’s difficult to have deep discussions. What is needed is a group of companies where managers could come together and establish a relationship with colleagues facing similar challenges and build enough trust that they could openly share information about achievements as well as failures.

There is thus a felt need for a conversation space where firms could contribute and at the same time get something in return from other companies that are grappling with the same kinds of challenges. These would need to be firms that are not direct competitors so that they could be open about things. This need is not currently being catered to.

The intent of the Learning Consortium currently being explored by the Scrum Alliance and the Center for Innovative Cultures is to create a forum where such conversations could take place.

Different Types of Learning Consortia

Over the last several decades, several different types of learning consortia have emerged to meet analogous needs in fields like lean manufacturing and knowledge management:

Member site visits: as at APQC in knowledge management, the members choose which sites to visit and go on the site visits themselves and make their own evaluation of what is working and what isn’t. The time frame was months and it produces are hypotheses for action, rather than scientifically proven conclusions.

Staffed evaluations: In the auto industry in the 1980s, a collaborative effort was made to evaluate lean manufacturing practices. In this case, the evaluations were made by staff over a number of years and resulted in the book, The Machine that Changed The World by James Womack and colleagues. This took many years to complete. It provided verified conclusions. But implementation proved to be sporadic.

Member conversations: In some cases, the collaboration takes the form of web-based conversations among practitioners without site visits.

“Leveraged learning networks”: In the 1990s in Canada, a number of formal learning associations were formed to explore (exploit?) lean manufacturing. These were groups of manufacturers that wanted to jointly solve problems, learn, and lever value from each other to enhance their competitiveness. In addition to site visits to improve their plants, there were monthly meetings to guide the learning, along with training and leadership activities that aligned with their vision. This experience was described as “leveraged learning networks” in a detailed case study in Sloan Management Review, by Ian Stuart and colleagues (Summer 1998).

The Learning Consortium currently proposed by the Scrum Alliance and the Center for Innovative Cultures is proposing to use the model of “member site visits.” The idea is to enable members to immerse themselves in these different management practices with other practitioners and “live the experience” and “get a feel” of what it is like to run an organization in this different way.

In discussions with potential members, it has also been suggested that this might be combined with online “member conversations” around specific topics of interest to members. This could keep the relationship among members active in between the site visits. A conversation space where ideas and questions and dialogs could take place could help keep the relationship ongoing so that the next time the members got together, there would be some history and some progress being made, on which the group could build.

Learnings from Earlier Consortia

Last week I spoke with Dave Hogg about his extensive experience in leading the Canadian Leveraged Learning Networks [ED: – alias Learning Lean Consortia] in lean manufacturing over the last twenty years.

Steve Denning(SD): You had many years of experience in leading learning consortia in lean manufacturing. What was your biggest challenge in conducting these learning consortia? Why were the firms willing to share their precious secrets?

Dave Hogg(DH): When you are starting off, the firms are pretty jealous of what they know and what they are willing to share. But as you talk value, you develop mutual trust. It grows with the logic and frequency of on-site conversations, telephone calls and newsletters. It’s all about trust, trust, trust. It’s constant trust building.

SD: What were some of the keys in building that trust?

DH: One key is getting the right facilitator. Every member of the consortium must feel that they are getting the value for which they joined. If a firm is going to share its intimate details with a lot of people in the consortium, its needs to see value to trust them. And a firm won’t be sharing if it doesn’t trust the other members. One of the things that got things off on the right foot is that one participant said that they could take his main production line and do a full Kaizen over an entire week. That inspired a lot of people to be willing to share.

The facilitation is key and must focus on the members’ needs. The participants can sense if the facilitator is out to sell something, like a consultant who is always thinking about what’s the next project. Companies can sense if the goal is something other than their own interests. Academics didn’t work as facilitators either. We were looking for people who understood the business, who had experience in industry, who knew something about Lean. It’s key to find the right facilitator.

 SD: How did the learning take place?

DH: Our approach began with networking and leveraging best practices but started to change when Lean came into existence. We got connected with Lean around 1993. Lean went viral in 1996 when Womack and Jones wrote their book on Lean Thinking (Simon & Schuster, 1996). Things took off after that. It was the beginning of a common language and understanding. The more we were preaching the culture of Lean, the more we could tie the consortium to Lean. Lean meant doing experiments and taking risks: we would go through the cycle, Plan, Do, Check, Act. It meant using a scientific systematic approach to learning, which we hadn’t been using before.

SD: How did you handle issues of confidentiality?

DH: The basic idea was to avoid having competitors within the consortium. We had a Code of Ethics which said that organizations might be precluded from joining if their participation “causes discomfort to members for competitive or other reasons.” The focus was on working with the members and resolving any problems. Once the trust level was established, they knew that there wouldn’t be a problem.

We never had an issue of one company writing about or disclosing what was happening in another firm. It was self-policed. The participation in the consortium was decided on by the top management at the site and they ensured the right kind of conduct. They have their own internal meetings about confidentiality. They put their own checks and balances in place.

SD: You never had competitors in the same consortium?

DH: We started out saying, “no competitors.” But it wasn’t always the case. In one instance, we had General Electric (who had just bought one of our member companies) and Rockwell Automation in the same consortium. That was because the top people in both of those plants said there was so much value in it. They trusted each other and they were part of the same community. If the trust level is sufficient, it’s ok. But it was rare to have direct competitors in the same consortium.

SD: Your code of ethics prohibited hiring staff from each other. How did that work in practice?

DH: That was prohibited in the Code of Ethics that we had. The members policed it themselves. In one instance, a hiccup occurred where it seemed one firm had hired from another and there was a suspicion that a conversation had taken place to entice the employee to join the other firm. So the top people from the two companies got together and looked into it. They found that the person being hired had discovered the opening in a public ad for the position that would further his career. So the companies agreed in that instance that there hadn’t been a breach of the Code of Ethics.

SD: How did you handle issues of payment of fees?

DH: Fees come at the end. If you begin by talking about price and cost, you have lost it. You might as well give up at that point. The conversation is about value, value and more value. If you are not giving value, people will walk away. But if people have the feeling it is their consortium – you can keep giving value, people will see value that they didn’t realize was there. At the outset, people had no idea of the benefits that they were going to be getting out of it. Of course, you eventually have to get to the question of costs, because no one is going to join until they know what the fee is for the value of belonging. We charged a thousand dollars per month. In due course, people see that the cost was just a fraction of the value that is produced.

SD: Were there hiccups along the way?

DH: Of course. Lean is all about experimentation. It’s about taking risk. When things don’t work out, the first question is always: what did we learn from that? How do we recharge? What countermeasure do we need – and, how do we turn this into something good that’s a win for everybody?

SD: Is there a right size for learning consortia?

DH: In our “leveraged learning networks”, which were essentially associations, we generally had ten to fifteen members. When you are talking thirty members, you are talking about a different management structure and dealing with more strategic & policy people at the senior levels. We were dealing with Sr. practitioners at the operations level of a plant, not people at more senior management level. At the senior management level, maybe you could have as many as fifty members. There are even larger ones than that, but they deal with strategy and policy. We were dealing with manufacturing operations issues.

When the numbers grow in an association, it can be difficult to give value to all the members and deal with each member’s needs. In one case, we got up to nineteen companies. That was one reason for the newsletter so that everyone could hear what was going on and extract value. But with nineteen members, some companies began feeling they were not getting the amount of attention to the issues that they felt were important. So where you cut it off is where people start re losing interest.

SD: What are the advantages of “leveraged learning networks” as compared to “site visits”?

DH: Leveraged learning networks are a deeper level of involvement than merely site visits. They involve forming an association of members with regular monthly meetings, a vision, a strategic plan and measurable goals. The meetings would discuss new initiatives, progress toward the vision that had been agreed at the end of the previous year and what advancement toward the vision had occurred over the last month. It would also deal with things like: “The price of oil has fallen drastically: what is the implication of that to each of us?” So someone would have an oil expert on their staff and we would set up a call with them or have them attend. The others would listen to what it’s all about and pitch in. There were ongoing dimensions such as training and leadership. And we organized tours outside of the members of the consortium and sometimes to Europe and involvement in major Lean conferences. The scope of the activities was driven by the members. They had their own businesses to run and you could only go as fast as they were able to go. That is why it was important for them to name the consortium and believe it is theirs.

A Learning Consortium for the Creative Economy

The intent is to build on these rich experiences in the Learning Consortium for the Creative Economy, now being explored by Scrum Alliance and the Center for Innovative Cultures at the Bill and Vieve School of Business at Westminster College.

The Learning Consortium for the Creative Economy will be emphasizing the need to create a space for deep conversations, not just listening to presentations, where members could get the same thing that they could have got from a blog or a book. The idea is to stimulate deeper interactions with people who are grappling with the same issues and in some cases succeeding.

This is not about academics telling firms what they should do. It’s about peer-to-peer learning where practitioners learn from other practitioners about what they are actually doing.

Members would also have a chance to share what they are doing and so enhance the brand of their organization as an organization that is actively pursuing innovation. Thus brand enhancement is one of the motivations of the financial sector for getting involved. Banks are not always perceived as hotbeds of innovation. So they sometimes have trouble in attracting the very best talent. Banks want to become places where the best and brightest want to come and work.

Scrum Alliance and the Center for Innovative Cultures are now actively exploring possible members and co-sponsors of the Consortium. The intent is to have a mix of young companies wholly immersed in the emerging leadership and management practices as well as large, traditionally managed companies that have important Creative Economy activities going on in parts of their organizations. The mix of companies involved will help bring out similarities and differences in management practices in these different contexts.

“By opening up and testing new ideas from across their companies and beyond,” says Andrew Hill in the Financial Times, “far-sighted leaders could achieve a more radical transformation than they ever anticipated – even if it starts with small steps.”