BUSINESSWEEK ONLINE : OCTOBER 23, 2000 ISSUE
BUSINESS WEEK E.BIZ -- MANAGEMENT ONLINE EXTRA: Q&A with Robert Buckman "We've had to change the culture...to take full advantage of the technology that keeps changing around us" Information technology is shifting the competitive edge from physical assets to the intellectual side of the ledger. Memphis-based Buckman Labs was one of the first to grasp that trend -- and to figure out how best to tap the full breadth and depth of its in-house knowledge. First introduced way back in the mid-1980s, the concept was such a novelty that many employees were slow to share their expertise with fellow workers. But Buckman made sharing mandatory, rewarding those who pooled information, while prodding those who did not. It took a while -- and the advent of the Net -- before the idea really took off inside the company. It was worth the wait, says former Chairman and CEO Robert Buckman, now chairman of the executive committee of the board of directors. Now when customers call with complex chemical problems, they get fast answers, thanks to the company's ability to identify, collect, and harness the collective knowledge of its employees. How does Buckman Labs do it? The answer is a powerful combination of information technology, innovative leadership, and canny management. "The combination of good management and smart technology can be powerful," says Buckman. The bottom line certainly says as much. Revenues hit $400 million last year and have been growing at a slightly faster pace than rivals can claim. Meanwhile, employee productivity has skyrocketed. Since 1992, sales per salesperson have gone up by 51%, and operating profit per employee has risen by 93% over the same period. Technology Strategies Editor Marcia Stepanek caught up with Buckman, the founder of what has come to be called "knowledge management,'' between a round of speaking engagements that took him from Memphis to Korea to Brazil. Here are edited excerpts of that conversation. Q: How did you come to this idea of sharing knowledge inside the company so it could be used to add value to products and for customers? A: When we started, there were no terms to describe what we were doing. We started on this journey in January, 1984, when I heard a quote from Jan Carlson, former chairman of SAS Airlines, who said: "An individual who is given information cannot help but take responsibility." That was when we started looking at what it would take to share "best practices" across the company. Because we were so scattered geographically, we began looking at electronic systems for communication that would connect us all together to facilitate access to the information that we had and how we would add to it. Q: I would imagine that was easier said than done. A: We spent years putting this together. This wasn't a project. It has been a journey. In addition to the technical aspects of doing this, we learned very quickly that it was going to take a significant amount of culture change to get people to share best practices across the barriers to communication in the company. Q: And the technology that helped to make it happen? A: We tried to do this with some homegrown systems until 1987, when we went with IBM's global network and gave PCs to the marketing forces and management. We wanted portable units... but back then the offerings were limited, and some of them weighed 17 pounds! As you can imagine, the challenges were quite different at the time. In any event, we learned what it would take to accomplish what we wanted to do going forward. We needed more portable units that could be carried easily by our people traveling around. We also needed to reorient our mainframe-oriented IT shop to a distributed networking environment and one that was oriented around the individual user. We also needed a global network that would allow us to connect, with one phone call and one I.D., to everything we wanted to give our people access to. We also needed a system for the sharing of tacit knowledge -- our in-house expertise -- around the needs of our customers, and on a global basis. And that's when it got harder. Q: How so? A: We had to address the culture change needed to share knowledge across time and space. That is when we began to talk about knowledge-sharing, and renamed and restructured our IT department into the Knowledge Transfer Dept. But people still had to be prodded to share. I'd have one of the marketing people keep track of who was sharing and who wasn't, and then I'd send the people who weren't an e-mail that let them know that I knew they weren't sharing, and asking them what it would take to get them to start. But even that didn't work for everyone. Q: What did you do? A: In 1994, we brought the top 150 people from around the world who had shared knowledge the best in 1993 to Scottsdale, Ariz., to meet with the planning team and decide how to better share knowledge, and what next steps to take in building this system. Out of that meeting came our Foro Latino, a system for the sharing of tacit knowledge in Spanish and Portuguese, ideas about effective engagement on the frontline -- how to empower salesmen to harness knowledge for customer value and problem-solving -- and other concepts. It was also around that time, in August of 1994, that Dick Baumbusch of U S West held the first conference on the concepts that we were dealing with...As far as I know, this was the first conference to discuss...what everyone now calls "knowledge management." Another one was held the following February in Atlanta, put together by McKinsey...giving wider use to the term knowledge management. I personally think it is the wrong term, but we are stuck with it now. Since then, I've been on the speaking circuit talking about the concept and how to implement it and refine it. Q: Why do you say "knowledge management" is the wrong term? A: It doesn't describe the concept accurately. You cannot manage what is in people's heads. You can encourage them to share it, but you can't manage it. Q: How is Buckman refining the concept for itself? A: We're working to develop software that allows the distribution of modules of learning over an electronic network. We moved to the Web in 1994. It was from this work that came the development of the Learning Center inside Buckman. Increasingly, this is the way that we're distributing learning within the company to our employees. We are also offering courses for credit and degree programs from about 20 different universities around the world, free of charge, to our employees. We had to go through the culture change we did, and to create unlimited opportunities for our employers to grow -- both to retain them and to keep their knowledge valuable to the company and to the customers they serve. This truly has been a journey. Q: In cultural change? A: Culture change to share best practices, to culture change to share knowledge, to culture change to create unlimited opportunities so that our employees can grow to be the best that they can be, and cultural change to now create virtual problem-solving teams across the global organization. We've had to change the culture so as to be able to take full advantage of the technology that keeps changing around us. It's been a journey, and the journey continues today. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _					RELATED ITEMS EBIZ Contents for issue dated Oct. 23, 2000 Spread the Knowhow TABLE: Smarts-Boosters ONLINE EXTRA: Q&A with Robert Buckman INTERACT E-Mail to Business Week Online

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