People-focused knowledge management

Comments: Prego made a typical mistake by initially allo-
cating insufficient resources to the project. That problem was
exacerbated by a management that neglected to support the 
execution team with sufficient competent resources after the 
project showed signs of failure.
The knowledge-related aspects in this case included insufficient
expertise in the project team for the complexity of the tasks required
for successful execution.
Monitoring and Governance Competence and Perspectives
Whereas delegated and distributed situation-handling proves very
effective for an enterprise when employees are motivated and com-
petent, there will always be a need to ascertain that work is per-
formed according to the enterprise’s intent and not in some other
direction. Deviations from the intended direction may be caused by
lack of competence, motivation, or understanding of what is
required. Deviations may also be caused by people with self-serving
agendas that are not aligned with the enterprise, and in some
instances even by destructive or counterproductive actions. Hence,
monitoring will always be important.
In other cases, such as when an enterprise pursues an exploratory
direction with competent and motivated people, monitoring is impor-
tant to redirect and improvise as new opportunities or constraints are
encountered.
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Company Works to Meet Societal Responsibilities
Atlee Chemical Corporation had been successful with its spe-
cialty chemicals, and the future looked promising. Over the
years, Pete Reinecker, Atlee’s president, had become convinced
that Atlee needed to observe its responsibilities, not only to its
owners and its employees, but also to the small town of Cross-
ing in which they were located. Atlee was the town’s largest tax-
payer and also provided most of its payroll. Without Atlee, Pete
was convinced, Crossing would cease to exist, and the livelihood
of most of its employees would be destroyed. As a result, as busi-
ness grew, Atlee’s management decided to expand in Crossing
instead of seeking more cost-effective locations elsewhere.
Not everyone agreed. Outside stockholders argued that the
Crossing operations were too expensive and that they would like
a more efficient plant that could yield greater profits. They also
felt that Atlee’s attempt to achieve total recycling with no emis-
sions or effluents also was too expensive, although its profits
were above average for the industry. A few of Atlee’s employ-
ees complained that environmental concerns made it hard to
operate the plant. Yet, Pete and his executive committee held on
to their philosophy to pursue the company’s broad responsibil-
ities and decided to continue to honor the basic principles.
It was not easy to operate Atlee as a responsible and model
corporate citizen. Throughout its operations there were constant
needs to balance short-term, low effort, and cost actions against
longer term and more societal-friendly actions. These dilemmas
were particularly frequent in Atlee’s physical operations which
interacted with air and water quality and other aspects of the
environment. Constant monitoring was required both by man-
agement to assist rank-and-file and by operators to ascertain
that equipment functioned properly at all times and that proper
maintenance was performed whenever needed.
Pete and his team believed that the present operating philos-
ophy was both prudent and in the best interest for all concerned.
First, they agreed that, whereas stockholders — owners — were
an important group of stakeholders and their interests should
be observed, they were not important to the exclusion of other
stakeholders. Hence, other stakeholders included Atlee’s
employees who invested their working life in the company and
relied on it for their own and their families’ current and future
livelihoods. The company also needed to be a responsible social
Enterprise Situation-Handling
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citizen, which meant that it could not ignore its effects on local
economics, social life, and the physical environment. Business
analysts and many outside owners clearly disagreed, but Pete
and his team decided that as long as they were profitable they
would stay the course.
Second, Atlee was successful because of the effectiveness of
its stable workforce. Worker morale was high, and turnover was
low, both leading to unusually high competency among its
workers. This was evident in operating statistics, which showed
an unusually low frequency of operational mishaps and acci-
dents, and low equipment repair costs since diagnosing and cor-
recting malfunctions were considered everyone’s responsibilities.
There were other indications as well: product quality was 
reliably high, and everyone took pride in making the operations
exemplary.