A sideways look at cognitive surpluses and knowledge “management”

Doc Searls used to keep reminding me of something he attributed to Don Marti: Information doesn’t want to be be free, it wants to be $5.99. Incidentally, talking about Doc Searls, here’s a bonus for Cluetrain devotees: the first time all four original Cluetrainers were together in one place, at Defrag in Denver last week.

Where was I? Oh yes, information doesn’t want to be free. You know something, sometimes I feel the same about knowledge. It doesn’t want to be free. As Paula Thornton said some years ago, maybe knowledge doesn’t want to be managed either.

Ever since I read Clay Shirky’s Cognitive Surplus earlier this year, I’ve been thinking about the book’s implications for “knowledge management” in the enterprise. Which is why I wrote what I did yesterday, and planned to follow up today. Which is what I’m doing here.

Let’s start with knowledge. For the sake of simplicity, I’m going to define knowledge in the enterprise as “information about anything and everything that makes our customers’ lives easier; as a corollary, information about anything and everything that helps us make our customers’ lives easier”. I feel that such a definition is in keeping with the ethos of Peter Drucker’s immortal saying “People make shoes. Not money“. If we make our customers’ lives easier, they will thank us for it. With their attention, their time, their loyalty, and even their money.

Using this definition, the management of knowledge can be defined as “the process by which we create, collect and share information that makes our customers’ lives easier”.

So who should be involved in such a process? Who would know the most about what would make our customers’ lives easier?

Our customers.

If you accept that logic, then the customer should be at the heart of any knowledge management system.

Who else? People who deal with the customer. Those who “touch” the customer. Followed by people who know something about the products or services those customers want or sometimes even need. Followed by people who know something about the process by which the products or services get created, delivered and exchanged for value.

Which means pretty much everybody in the enterprise. The extended enterprise. All the way to the customer.

Okay, so that’s the what and the who of knowledge management. Let’s take a look at the how.

One way of defining the how is to look at the things that failed in the past.

  • The right people weren’t involved.
  • Access and edit permissions were hierarchical rather than networked, preserving “expertise”
  • Information was inaccurate; without scale, the costs to correct were too high.
  • Information was missing: only text could be captured, image and sound were missing.
  • Information was out of date; production, reproduction and distribution costs were prohibitive, reviews were infrequent.
  • Information was inaccessible. Analogue, poorly indexed, and hard to copy.

Today, all these failures can be dealt with. Scale is not an issue for companies designed to make proper use of the internet. Network-based architectures are inherently more flexible than their hierarchical predecessors: role- and function- based permissioning is simpler to implement. Smartphones allow us to capture all types of media, not just text. Connectivity is pretty much ubiquitous. And the information is held digitally in the cloud, taggable, searchable, retrievable. From anywhere. Anytime.

Taking a leaf out of Clay’s book:

We have the means. Cloud computing infrastructures. Smart phones. Cloud services that allow people to converse with each other, share and annotate digital objects, improve upon them.

We have the motives. Human beings are inherently social, we like sharing. We enjoy the bonding, the peer respect, the recognition. No man is an iland, intire of it selfe.

We just haven’t had the opportunity before. Enlightened bosses are now providing that opportunity, by focusing on outcomes rather than input timesheets, allowing their staff to determine what happens with their cognitive surpluses.

Knowledge workers, part of the tertiary sector, are intrinsically different from those employed in the historical primary and secondary sectors of agriculture and manufacturing. Their work is lumpy, amorphous, misshapen, non-linear.

This is not a new problem. Many “professionals” faced real challenges of scheduling and prioritisation, and found it impossible to have true predictability in workflow. Ask a doctor. A nurse. A teacher. A policeman or fireman. Their lives have been about lumpiness and unpredictability and non-linearity.

But we were stuck in the manufacturing mindset, so we pretended these anomalies didn’t exist. And we designed our education and healthcare institutions as if they were industrial in origin. Look what they’ve done to my song, ma.

Today is another day. We now have means, motive and opportunity. All we have to do is to allow people to make use of their cognitive surpluses. Focus on outcomes rather than inputs. And make everything we do centre on the customer.

[Okay, after a period of quiet I’ve now written two posts in two days. Which means the risk of getting flamed is high. I await your comments. With some trepidation. ]

29 thoughts on “A sideways look at cognitive surpluses and knowledge “management””

  1. Dear JP,

    Agree totally with you. yes, the thoughts about KM have origins in “what is my firm’s intellectual capital?” school of thought. Which leads to talk about reuse (in the case of a firm with repeatable predictiveness) or connecting subject matter experts (in the case the client/customer solutions are customised)

    Each company needs to reflect what is it’s own “knowledge” or (I like Ram Charan’s usage better) “know how” that helps solve the customer’s problem or creates new markets/products for the same set of customers

  2. I’ll see your lumpy and raise you a squishy. Love the lumpy (reminiscent of the mid-90s when we looked at managing blobs — binary large objects).

    Here’s the thing, this isn’t a management space at all. It’s far more fluid and squishy. The operative word for Twitter is ‘flow’. While workflow might seem relevant, instead it’s too linear — it fixes the work into a flow. Instead the more relevant perspective is flow of work — the work goes where it needs to go, based on contextual agreements — again focused on what’s relevant, now.

    In this case ‘now’ isn’t even really temporal. The more significant attribute of ‘now’ is the conditions/state of ‘now’. In Data Warehousing we called it the ‘snapshot’. In database it’s the timestamp, which again is less relevant temporally than it is a means by which to recreate the ‘now’ that occurred at a particular time.

    Prediction is meaningless. The pertinent p-word is Possibilities. We can consider the possibilities. Better yet, we don’t even have to wait for them — we can create them. We can recast the future by making it happen ‘now’.

    We’re not empowering people to leverage their cognitive surpluses. We’re enabling them to challenge how they invest their time to begin with. We’re letting them manipulate both the supply and the demand, themselves. But then again, I really need to read Clay’s book…

  3. Lest I just look like a nattering ninny, let me offer an example. How does one go beyond the outcome of cognitive surplus? By shifting the supply and demand.

    Classic example: Alcoa Fastening Systems. They ‘shortened the distance’ — by eliminating status reports. How? By forcing management to ‘look’ at the work and letting the observable work stand as a testament of what was being done. They challenged the ‘intent’ of the activity and offered a different way of achieving it. Of course, they had to introduce ways to create work artifacts — ways to make it observable. http://traction.tractionsoftware.com/traction/permalink/Blog1461

    Brian Tullis from Alcoa Fastening Systems spoke about it in an interview: http://tractiontug.blip.tv/file/4276515/

  4. This post is fantastic. I really found it thought provoking as it made we wonder how you take this approach to public services… the idea of working to outputs and using the ‘cognitive surplus’ would make a big impact rather than focusing on inputs. Making services more responsive and flexible can only be achieved by creating a more empowering, innovation-ready internal culture.

  5. JP,

    Another great post (though I must confess some difficulty in parsing the 4th para, and reading between the lines this could be taken as a sales pitch for your new employer’s services).

    Like yesterday’s post this forces me to rethink (or at least reconsider) some of the basic assumptions hanging around out there about the nature of businesses. In this case – what is an enterprise?

    Knowledge Management as you define it has failed time and again because it stopped at the enterprise boundary – a boundary marked by the walls of buildings in the physical world and the walls of fire in the virtual world. ‘Enterprise’ IT must take a lot of blame for this, as it has only ever been designed to address the needs of insiders. Customers, partners, suppliers – they’re outsiders – the enemy.

    Cloud computing doesn’t work inside the firewall. Hence those that aggressively adopt cloud computing won’t only benefit from commodity pricing and availability for basics like infrastructure; but they will also be working in the same place as the extended enterprise – a place where all those other people that make up your business are.

    If we can all start meeting in the same place – the Internet – then information exchange and knowledge creation can happen. Having done some experiments a while ago I’m not entirely convinced that the net (or electronic communications in general) can serve the needs of all the ‘Ba’ (places) in Nonaka and Takeuchi’s knowledge creation spiral (SECI model) – there’s still a need for face to face interactions for socialization. A public network is however a much better place to start than a private one.

  6. I can’t argue with much of what you have stated, indeed it is on the right track.

    Let’s be clear – we can’t ‘manage’ knowledge in any traditional sense, the whole premis is flawed, and it is great to see that you also put ‘management’ in quotations in your title. I really loathe that term when associated with knowledge!

    Where we do need to get to is a place where the right knowledge is made available to the right people at the right time. Which means a great degree of contextualisation of the knowledge – and a challenge is to get that right some how. This is where technology can help, but we are a long way off getting this by any means perfect.

    But before we can even get the knowledge to the right people it needs to be collected, appropriately tagged and indexed and prepared for redistribution. And this needs to be done automatically.

    Ask a doctor. A nurse. A teacher. A policeman or fireman… they’ll want knowledge, and they’ll want it RIGHT NOW. But they won’t want to have to formalise their knowledge and thinking for others to reuse – they simply don’t have the time. So we need to find innovative ways to capture what they do, as they do it, and reuse that… now there’s a challenge.

  7. In principle “KM” has no real foothold in enterprises until the powers-that-be agree to recognise human and social capital on the balance sheet. I am less than overjoyed at what has been done with “intellectual property” over the last 150 years, so I tend to avoid the term “intellectual capital”.

  8. As we move from static to dynamic, as we move from stocks to flows, as the “Big Shift” of Hagel, Seely Brown and Davison becomes a reality, we need new tools that reflect those changes.

  9. Outcome-based approaches have a high propensity to create cognitive surpluses that can then be applied to new tasks and domains. I think the origins of “if you want to get something done, ask a busy person” were deeply rooted in that knowledge.

  10. Chris, there wasn’t an intentional plug, I have believed in the value of facebook- and twitter-like constructs in the enterprise for a long time now. Rgds

  11. I’m not sure if ‘customer-centric’ is the right word any more. Lately I’ve been thinking more about the word ‘Purpose’. If you have a purpose, you cannot stop yourself thinking about other people, and making the world a better place. You make money because you make shoes because your care about something that hppens when people have shoes.

  12. @gordon – love the thought about “purpose”
    IMHO, a purpose gives work meaning – and encourages people to share…

    No research to back that up, of course :-)

  13. @JP agree about “intellectual capital” being an extractors’ point of view – I think it was Ikujiro Nonaka who insisted on using “knowledge creation” instead of “KM” – and said “socialisation” was a way to share “implicit” knowledge

    I think now “implicit” knowledge can be share by sharing the “process of doing” via status updates

  14. Gordon: You’re tracking with the concepts that Charles Handy speaks of at length in his book “The Age of Paradox” — the specific points you’ve made I quoted a bit in a recent post: http://twurl.nl/knobd0 (toward the end).

    But I specifically came back to this conversation to share something I just was reading about in the same title, that JP was mentioning “intellectual property”. Indeed, what Handy helps me see is that KM (particularly cued by the word ‘management’) is focused on capitalizing ownership of artifacts. But the value isn’t in the artifacts. The value is in the source of the artifacts: the people themselves!

    I’m pretty sure that’s why I’m having an issue with the concept of ‘cognitive surplus’. It is still fundamentally focused on human as capital — which effectively they are, but how you perceive something is how you treat it. Capital is something that is owned. Says Handy “Owning people, no matter how well you treat them, is considered wrong in every other part of life.”

    Particularly in service organizations the largest ‘assets’ a company has are people. The value of those people, particularly in service organizations, is their ability to apply their intellect — not as machine parts, but as fully functioning humans. Handy says of business: “…its key assets are its human resources and the kinds of intellectual advantage that they carry around with them — not just their creativity and technical knowledge, but also their network of contacts, their human skills, and their experience.”

    Years ago when I questioned the fundamental premise of knowledge management I suggested that our goal was not to manage knowledge, but to facilitate thinking. Such thinking is (to tie back in JP’s mention of same) a flow not a stock. It is a ‘now’ activity, which leverages artifacts from the past.

    You can’t ‘own’ such activity — it’s not an intellectual property, in the current legal sense. Handy offers another perspective: “Intellectual property means people. Organizations are nothing if they are not communities of people, and a community is not a property. A community is not a commodity to be bought or sold. A community has “members” not “employees,” and it belongs to its members. [Oversimplified highly here, one of the challenges of such entities, is a balance of responsibility to the community — where responsibility is abdicated by individuals, the care and nurturing for survival must come from dedicated ‘others’.]

    Handy goes on to use all of this as his ideal model for businesses, which he describes as “self-governing communities”. Call me crazy, but that’s would make Seattle the poster-child of the business community — the petri dish of the co-operative as business model (REI, Group Health, PCC Natural Markets, The University Bookstore).

  15. The problem with old approaches to knowledge management in the enterprise is that they are seen as ways of separating the intellectual capital from the people. The key difference with the ‘Enterprise 2.0’ approaches (for lack of a better term) is that they offer the possibility of not separating so much as enhancing/augmenting the intellectual capital of the people – a shift in emphasis from knowledge ‘management’ to knowledge ‘systems’ in the systems thinking sense of feedback loops, etc. I could also characterise it as a shift from ‘capturing’ to ‘learning’ – ie a shift from ‘stocks’ to ‘flows’. Clay’s idea is interesting in that it looks at the dynamic between a stock of time and a flow of activities.

  16. Paula, really interesting post (oh yes, and you too JP!) but your comment “Particularly in service organizations the largest ‘assets’ a company has are people. ” Doesn’t complete the picture. Yes a company’s employees are it’s assets, but when it comes to financial reporting they appear as a cost. Hence whenever profits are challenged the current management crop don’t think “how can i maximise my assets?” they think, “how can i cut my costs?”

  17. @gordon possibly, I’m not sure. I think the word customer has meaning even if it has been corrupted over the last sixty years. I think purpose has to do with motive, customer has to do with design. not sure I’m expressing it right, but I will work on it

  18. @gautam I think we’ve never really had the ability to capture and share tacit knowledge the way we can today. not just by doing, but by recording, tagging, enhancing, archiving, retrieving.

  19. @blinddrew until we have a way of recognising human and social capital to have value, even as “intangibles” like goodwill and brand, we will always have this problem

  20. And software doesn’t want to be free either – lumpy and unpredictable as it might appear. Can someone explain why software should be free when, say – cars or houses aren’t?

  21. The “free” that people want of software is “free as in freedom” free, not “free as in gratis” free. Openness is the key.

    Separately, the reproduction and transmission costs of bits are quite different from those of atoms. The warehousing and distribution costs are different as well. So houses and cars are not the same as software.

    There is a case to be made for “free as in gratis”, in the context of figuring out whether you’re operating within the economics of scarcity or the economics of abundance. A good place to start is Kevin Kelly’s majestic essay: Better Than Free, which you can get to here:


  22. From GNU.org – “The term “open source” software is used by some people to mean more or less the same category as free software. It is not exactly the same class of software: they accept some licenses that we consider too restrictive, and there are free software licenses they have not accepted. However, the differences in extension of the category are small: nearly all free software is open source, and nearly all open source software is free.”

    – Free Software Foundation, http://www.gnu.org/philosophy/categories.html

    And, while obviously houses and cars are not the same as software, they share some common attributes as to how they came about. Labor goes into creating all three.

  23. @csp I agree that a lot of open source software is royalty- and licence-fee-free as well, but my sense is that the freedom is the important free, not the gratis.

    From an economic viewpoint, cars and houses are rivalrous goods; the ownership of a house or car by one person prevents another from owning it. Digital goods tend to be nonrivalrous, and information is the extreme form.

    Since digital goods tend to be abundant, to the extent that reproduction and transmission costs are negligible, it is possible to price such goods according to the economics of abundance rather than that of scarcity. That’s why I suggested you read Kevin Kelly’s essay.

    Software can be priced by copy, by seat, by transaction, by usage level, by right-to-use licence; it can be made available for free in digital form, and charged for when delivered via disk. Some people charge for manuals, some for training, some for support and consultancy.

    We are still learning how to price abundance. At this stage, the issue is not price versus no price. It is open versus closed.

  24. No intention to flame but actually inputs are important. When we manage academics, for example we don’t manage outputs. When we ask one simple question, what do you want to teach? we take them to the edge of their competence, the edge of their field where scholarship is happening. Students receive a proper apprenticeship in the field and the body language of the teacher becomes animated and contagiously enthusiastic.

    All we have to do is back up that enthusiastic classroom and the numbers take care of themselves.

    Many of the issues you describe are control issues – managers trying to make jobs for themselves instead of being grateful they have smart colleagues and putting their feet on the desk for the remainder of the afternoon. This philosophy works just as well in factories and has been demonstrated over and over again.

    Of course, academics are dragging their feet now. The academic venture that led to indexing academic writing (prompted by RS I believe) has been superseded by tagging and they aren’t quite there yet – again because of vested interests not because they don’t know. Academics exchange work informally before it reaches print. Indeed as it takes years to get into print, that its a necessity. It is just done in cumbersome way via email. There are also concerns about work seeing the light of day before a person can reap a profit from it as people jockey for grants and other power-related benefits.

    We aren’t dealing with tech issues. We are dealing with a social revolution. The revolution is going to happen as surely as the original journals got indexed when they became too many. It is not whether the peasants will eat cake, I am afraid. It is that those who do not understand the concept of bread are in frightful trouble because they cannot conceive of other lives for themselves. It’s puzzling because it is so easy but that it never works that way. This is not the first time. It will not be the last.

  25. Thanks for another really thought-provoking post. I am a huge fan of yours and have found what you have to say compelling when I have heard you speak. My apologies if any of my comments are perceived as flaming.


    I have not read Clay Shirky’s ‘Cognitive Surplus’. What I have done in the past is spent a long time researching, observing, talking to and working with people on manufacturing shop floors. The last great management disruption was lean, quality and agile in manufacturing, in response to globalisation and competitive threats.

    You say, ”If we make our customers’ lives easier, they will thank us for it.”. In quality, people are encouraged to see each other as internal customers. You also say, ”The customer should be at the heart of any knowledge management system”. Spot-on, and applies to internal and external customers alike.

    In a retrospective comment on a highly acclaimed and popular article he had written, Hertzberg said, ”The key to job enrichment is nurturing client relationships, rather than functional or hierarchical relationships”. He illustrates by an example of various trades supplying services to one another in aircraft maintenance. He asks ”who do I serve?” rather than ”who do I report to?”

    We can learn a lot from the last great management disruption.


    Engaging people in sharing their tacit knowledge of processes and their machines through problem-solving and continuous improvement, especially those previously overlooked on shop floors, was core to the success of lean, JIT, quality etc. No engagement, no lean. This was about committing to a different philosophy of work, changing attitudes and new ways of doing things. Sounds to me like recognising and harnessing “cognitive surplus”.

    Much of what Vineet Nayar is saying in ’Employees First, Customers Second’ has a strong echo in what I found in researching empowerment on manufacturing factory floors in the late 1990s. He speaks about replacing ”zones of control” with ”spans of influence”, where manager-leaders let go of their obsession with control and re-focus on influence. They extend their influence by engaging in dialogue with those who are creating customer value, removing barriers to performance, and providing organisational environments that enable people to engage with their work and each other.

    This is exactly what happened in what I am calling first wave smart working, where the role of key senior managers and team leaders in making the transition to new ways of working was to influence, encourage and communicate in supporting shop floor operators as they engaged in value-creating, customer-focused performance.

    Knowledge does not want to be managed but setting the initial conditions, creating performance environments, does want to be managed.


    I agree wholeheartedly – we have the means, we have the motive and an increasingly urgent commercial imperative. What was previously Continuous Improvement is now Collective Intelligence. From CI 1.0 to CI 2.0 if you like. The final paragraph in the book I have just finished concludes:

    ”I have argued that there are first principles of organising, that people’s psychological, social and cultural needs must be considered in creating high-performance environments, that there is a legacy of learning on making the transition to new ways of working, and that the tools and methods to do this are available in abundance … we need to create our way into the next wave of smart working and managing. It is all there for the taking and there are no excuses”.

    Ouchi, W.G. 1977. The relationship between organisational structure and organisational control. Administrative Science Quarterly, 22, 95-113. Talks about behaviour and output control.

    Hertzberg, F. 1987. One more time: how do you motivate employees? Harvard Business Review [Online 1 January 2003]. Available at: http://hbr.org/product/one-more-time-how-do-you-motivate-employees-harvar/an/R0301F-PDF-ENG

    Have you come across the Puttick Grid http://bit.ly/dUNJ2q? This categorises different types of manufacturing enterprises according to product complexity and market uncertainty. I don’t recognise ”certainty of product flow”, even in the commodities and volume category. Where people are involved, there is never certainty. In my experience, people are never subordinate to process or machines. Short-runs, agility and collaboration to achieve process integration = social, lumpy, amorphous, misshapen, non-linear work.

  26. Cognitive surplus talks about using surplus time to share experiences and information…and I guess also helping others in the context of need (which happens quite a lot in our internal CoPs). The sharing experiences part doesn’t happen as often as it’s more proactive, people share links and news, but stories and tips are fewer. Yes this could be due to a lot of things like engagement, current organisational design where we reward individual action on meeting targets, and time (unless you have Google collaboration time)

    But you can also share the process of doing work, which may not be as reflective, actually it’s more raw, but just the same you are sharing. This is better known as “observable work” as @paula mentioned.

    In this way you are sharing regardless of the cognitive surplus concept

    I think both are required for an agile workplace

  27. Great dialogue here about employees (costs / assets), social capital, intangibles

    Here’s some links of late that are spot on
    Douglas C Wood – Assets don’t create; It is this creative process that makes the company alter its shape, migrate with the market, fix new kinds of problems for customers, and finally survive and grow

    Jay Cross – Balance sheets do not record intangibles, things like know-how, customer relationships, and reputation. On the balance sheet, highly-skilled people have the same value as new hires: zero

    Steve Denning – Management in the 21st Century is about the infinite goal of delighting customers; the firm makes money, yes, but as a consequence of the delight that it creates for customers, not as the goal.

    The firm is no longer an end in itself

    I first came to know about the value of intangibles from a podcast by Verna Allee

Let me know what you think