People-focused knowledge management

The knowledge-related aspects of this case included the many
sales, marketing, and MRD people who appeared to have narrow
knowledge that prevented them from perceiving opportunities. The
taskforce learned to recognize potential new customers. Perhaps most
importantly, the taskforce was able to engage in deep knowledge
transfer to those who ultimately needed to use it, the management.
Sensemaking in the Enterprise
In unexpected, less known, and more complex situations, enter-
prise situation-handling becomes increasingly ad hoc. Under these
conditions, sensemaking is particularly important and requires think-
ing about the unexpected — “thinking outside the box.” Sensemak-
ing of what may appear to be a simple matter often requires
considerable effort as illustrated by the following example:
Production Line Investigation Finds Reasons for
Cost and Delivery Problems
Morrison Company, an agricultural machine manufacturer,
experienced unacceptable rework and production delays in one
of their production lines. Joe Hanson, the plant industrial engi-
neer, investigated the problems to find out what was wrong and
pursued the task from different perspectives. He assembled 
production statistics and information on production machine
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downtime and repairs. He interviewed supervisors and line per-
sonnel. For hours, he observed activities on the production line,
paying particular attention to trouble spots. And he examined
parts that needed rework. Joe also followed information flows
and parts flows in his attempts to find discrepancies.
Joe uncovered evidence indicating that several things ap-
peared to be wrong. There were unaccounted interruptions of
the production line work flow. There were unacceptable quality
problems that the inspectors and testers identified at the end of
the production line. The quality problems were perplexing;
some appeared to be machining problems, whereas others might
be problematic materials. In addition, there were long down-
times when equipment failed. Most of these problems were new,
and it was uncertain what caused them. Morrison had recently
completed a cost containment program, and Joe suspected that
some problems might be related since they seemed to have
appeared after the program was implemented. That was hotly
denied by those who had promoted cost cutting. Nevertheless,
he explored the possibility of any connections. After thorough
analysis and collaboration with workers and supervisors, Joe
identified the following issues.
The cost containment had resulted in several separate moves
to reduce costs. Plant maintenance staff had been reduced, 
production line overcapacity had been eliminated, and procure-
ment had changed to lower-cost suppliers for some materials.
Whereas these changes had resulted in somewhat lower costs,
they in turn had led to the observed operating problems in the
following manner.
The reduced maintenance staff led to maintenance scheduling
problems and long wait times — delays — to fix equipment.
Also, since teams were measured by throughput, long main-
tenance delays resulted in reduced productivity and a ten-
dency to continue to operate with out-of-spec equipment,
which resulted in out-of-tolerance quality problems at the 
end of the line. In Joe’s mind, this could be avoided if the 
production line workers were allowed to perform selected
maintenance on their equipment. However, that required
additional education and new operating practices and super-
visory functions.
Some new, low-cost suppliers delivered materials (such as
high-strength bolts) that failed during product tests and
required repair and rework.
Enterprise Situation-Handling
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The production line capacity reductions led to reduced flexi-
bility. Morrison had always been proud to provide individu-
alized customer service, including expediting orders from
important customers. That had never caused problems since
the overcapacity had absorbed the associated disturbances.
Instead, the leaner production line could not absorb expedit-
ing and production delays, and other disruptions resulted.