Words from the wise

The bricklayers are here, bright-eyed and bushy-tailed. Brilliant. But they’ve got no mortar because the builders’ merchant hasn’t delivered the sand like they said they would. There goes the programme, there go the bricklayers, there goes the site manager’s juicy bonus.

How many times has this happened before? Even more depressing: how many times will it happen again?

Construction is filled with bright, capable and experienced people, but in a real sense we just never learn.

How can we? It was that very question that launched us on an 18-month experiment with 12 small and medium-sized companies across the country. We wanted to try a knowledge management technique that would turn site managers’ day-to-day problems into the sort of wisdom an entire company can not only absorb, but act on.

Knowledge management (KM) has been around for some time, but it tends to involve costly consultants or sophisticated software, so it’s usually the preserve of big companies.

Most UK construction firms are small. In 2002, 99% of them had less than 59 staff, employing 62% of the industry’s workforce and delivering 44% of the industry’s workload (in monetary terms) [DTI, 2003]. Compared to big companies, these small-to-medium sized enterprises (SMEs) cannot invest heavily in innovation and development, and take a less-formal strategy in management with an emphasis on survival and cash flow. Their staff are heroic multi-taskers but they’re stretched, so knowledge in SMEs tends to be local, oral, tacit and contextual – in other words, trapped in the heads of these busy individuals.

Looking for an easy KM technique for them, we came up with Knowledge-Event Management (KEM). It’s simple. You don’t need squadrons of management consultants, or company-wide IT rollouts. You just need a Dictaphone and someone to talk to.

Power learning

Site managers rarely have time to reflect on their experiences, so knowledge gained is lost from one project to the next. As a result, mistakes are repeated, resources are wasted, and organisations do too much fire fighting.

Why? In 1984, organisational behaviour expert David Kolb argued that effective learning requires the full journey around the four stages of a cycle, namely concrete experience, reflective observation, abstract conceptualisation and active experimentation. The problem is that we tend to evolve skills in one area and so ‘short-circuit’ the full cycle. This means we don’t learn as much as we could. “So,” we wondered. “How can construction SMEs process their hard knocks more profitably?”

In this project, 28 site managers used audio diaries to record events that upset the flow of things. They could have been technical issues or people issues. Written diaries might have worked, but we felt the need for writing would put people off. It takes a certain skill and too much time. Besides, construction is a markedly oral industry. The spoken word is richer in meaning because of nuances, body language and context. So we decided on Dictaphones: cheap, easy-to-use, and readily available.

But just recording events wasn’t enough. How do you encourage deeper reflection or create knowledge that can be transferred? We used the military concept of debriefing – mining an experience to develop new strategies. So after a number of audio diary entries, we debriefed participants for half an hour and made a chart, called a target diagram that helps identify the issues that sparked the event – not just the obvious triggers, but the wider issues at play.

The next step was getting what we learned out to the rest of the company. This wasn’t easy. Wider dissemination requires multiple methods, as there are different types and levels of knowledge. Factual knowledge can be communicated easily through poster, newsletter, email and web page. Process knowledge needs more interaction between people so we used workshops, quizzes and informal critical conversations.

In action

We did 109 debriefings and they really show the complex decision-making managers have to undertake – sand not arriving on time, for example. This really happened.

Mr T, the site manager on a small site, had to decide what to do: upset the bricklayers by laying them off without pay, keep them on and lose the money or pay through the nose for an emergency batch from another merchant, losing time and money. In the end he negotiated with the bricklayers and laid them off for half a day.

Speaking into his Dictaphone while it was all still fresh, Mr T said materials delays were common and that the supplier was to blame. He thought he should be stricter on suppliers and order earlier if space and cash flow allowed. But in the debriefing, a deeper discussion led to some more profound learning points that the company as a whole could take on board.

There were the usual constraints: top bricklayers are scarce, a good relationship takes time to build, you can’t store much on a small site, head office orders the sand and chooses merchants on lowest cost, so you can’t cancel this merchant and re-negotiate with another, etc.

While taken for granted, these factors also combine to ensure that disruptions will happen – like the non-appearance of sand when it really matters. So Mr T can have words with the merchant, by all means, but the firm can learn a few things too, such as:

• Setting up good working relationships with subcontractors and individual workpeople allows more flexibility and minimises disruption from problems.
• The service from a merchant needs to be negotiated as well as price.
• The relationship between head office and site needs to be clearer regarding responsibilities for site costs, site performance and individual bonuses.

Costing Knowledge

We found that KEM helped us put a price tag on disruptive events. For example, a half day’s money for bricklayers wasted £400; the acceleration cost of overtime to the bricklayers was £600; the time involved in contacting the supplier, negotiating with the bricklayers and other trades, extra work for head office ordering and contract managers and reprogramming was calculated at six hours (equivalent to £300). At the same time, there was a reduction in the site manager’s productivity both due to the missed opportunity of improved efficiency and the demotivation due to the frustration, estimated as £200 (this could be a lot higher if the manager was prevented from closely monitoring risks). The total for this small incident was over £1500. However, if the repetition of this is considered then in this £400,000 project, then maybe £6000 is wasted in rescuing failed delivery. This might amount to 20% of the profit. You can see how small incidents like this are haemorrhaging money from the company.

Did it work?

Yes. We surveyed participants and this turned up some notable results. For instance, two thirds of respondents said their organisation did not recognise the skills they had, which I think indicates the richness of the tacit knowledge embedded in organisations and the huge potential for companies to benefit from it. All respondents agreed that it was possible to make improvements through learning from events and debriefing.

60% liked the audio diaries, 90% agreed that debriefing was effective. 60% believed their companies could perform KEM themselves, although there were barriers, such as an unwillingness to share knowledge, reluctance to change, and incoherent company strategy.

Industry Self-operation

Ultimately, firms should be able to do KEM themselves without us facilitating. A number of the companies are looking at using it in their own way, like doing the event collection and debriefing at the same time at site meetings, or taking one or two events to the post project review meeting and using the target diagram to analyse them. These variations should work fine. What matters is the act of recording, reflecting and then using the knowledge.

A free handbook is available, which allows companies to operate KEM themselves. You can start with one-off activities involving a few people with little commitment, and see how it feels before moving to a substantive, company-wide exercise.

You may not be surprised to learn, too, that we’re available for consultation, so get in touch if you want more information.