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|In: Cognitive Enterprise|Last Updated:

The dullest, and probably the most important chapter in The Cognitive Enterprise (Bob Lewis and Scott Lee, 2016) addresses a central topic when it comes to cognition: What does it mean for an organization to “know” something?

We started with the tired old “knowledge pyramid” — you know, the one that starts with Data and progresses through Information and Knowledge until arriving at Wisdom (DIKW).

The old pyramid gets just about everything wrong, at least as it’s usually explained. And the flaws matter: For an enterprise to act as if it thinks, getting this right is essential.

Here’s an overview. To get the whole story you’ll need to buy the book. It pains me to say this, and I plan to continue in my agony until you … that’s right, you, the person reading these words right now … until you get yourself a copy and write an honest review on Amazon.

Where was I. That’s right — the old DIKW pyramid and what to do about it.

Start with Data. Most of DIKW’s proponents would have you think that every byte stored on your company’s hard drives, NASes and SANs is data. When you read an awe-inducing statistic about the data explosion, it’s probably based on the every-byte-stored definition. You’d think the GIGO principle (Garbage In/Garbage Out) was still waiting to be formulated.

Data (plural of datum if anyone still cares about such things) is actually a collection of individually verifiable facts. Your eye color is a datum. So are your driver’s license number, your annual income, and how many miles you walk every week.

Data aren’t always verified, but they must be verifiable.

Information next. No, it isn’t data that have been processed to provide something useful. Definitions like this entirely ignore the well-developed branch of mathematics upon which the entire data process industry is founded: Information theory.

Information is the stuff that reduces uncertainty. It comes in bits, one of which is the quantity of information that cuts your uncertainty about something in half. The classic example is a coin toss. You know it either landed heads or tails. One bit of information will resolve your uncertainty about the result.

For the most part, though, information doesn’t eliminate uncertainty. It reduces it — a very different matter. Even in the case of the coin toss, if someone tells you it landed heads you still aren’t absolutely sure. Your informant might, for example, be an untrustworthy source.

Information is, by the way, what a good system of metrics provides.

Which gets us to knowledge – a word that’s been hard to pin down since Plato first wrote about it a few millennia back, not that he got anywhere with his ponderings.

I’m not criticizing, mind you. Epistemology is an eyeball-crossing domain.

Scientists generally rely on Karl Popper’s approach to things: You start with a proposition and do everything you can to disprove it. A proposition that’s survived all the tests human ingenuity can subject it to — nobody can think of any more tests that might disprove it — is considered by scientists to be something they “know,” in quotes because they know that everything they “know” is just one additional test away from being something they used to know, only now they know better.

Business managers (and, for that matter, consultants) don’t have the luxury of subjecting their knowledge to testing that’s as thorough as what scientists are able to manage. We have to make do.

Scott and I are practical guys, not epistemologists. We figure you know something if you’ve looked into it extensively and have concluded there’s just no point in worrying about it anymore. You still might be wrong, but you’re more than certain enough to act.

Then we added a new layer: Judgment. It sits between knowledge and wisdom in the pyramid. Judgment is about tempering your knowledge about something with related insights that come from experience. It’s your safety net when making difficult decisions.

At the top of the pyramid there’s wisdom — broad principles about important subjects, which you don’t find very often, and when you do it’s rarely in the domain of commerce.

Now, finally, we’re ready to talk about what it means for an enterprise to be cognitive. It means the enterprise does a fair imitation of knowing things, as distinct from the people in it knowing things.

In a cognitive enterprise, when it comes to the most important subjects, most people share similar views, with similar levels of certainty, and so can be trusted to make similar decisions when it’s their turn to do so.

A different way of saying it: In a cognitive enterprise, knowledge becomes culture, and culture becomes the centerpiece of governance.

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|In: Business Ethics|Last Updated:

No, no, no. I wasn’t talking about Social Security and credit card numbers. It’s all the stuff companies claim is uniquely valuable, that has never occurred to competitors, and that would never occur to them unless and until someone sent them a PowerPoint deck.

Last week’s KJR made the case that most businesses have become so permeable that it’s a fact, not a problem, which means they have to deal with it, not solve it.

And further, that the best way to deal with permeability is to take advantage of it as a better path to profitability than trying to build ever-higher and thicker walls around the enterprise.

As all software testers know, good test plans include a plentiful portion of edge cases, so it isn’t surprising some correspondents expressed concern that KJR might take the position that corporations should relax their controls on information whose compromise could result in, for example, identity theft.

These edge cases are good tests, only not of the overall principle. Customer identification and privacy information? Protect it to the best of your ability. Short-term plans where whoever gets to market first wins big? Protect those to the best of your ability, too.

The process you use for purchase-order/invoice reconciliation, or, as Jimmy John’s notoriously seems to think needs protecting, for making a ham and cheese sandwich?

Uh … no.

As pointed out last week, many business theorists and leaders, for several decades now, have considered employees to be fungible commodities, to be traded into and out of the pool of available talent without compunction or regret.

But when they’re traded, they take their knowledge with them — an apparently unintended consequence of this employment philosophy.

Shared knowledge is at the heart of the Cognitive Enterprise. One consequence of replacing a long-term employee who has a vast fund of institutional knowledge is …

Well, it depends. If the employee’s replacement is quite a lot less experienced, or if there is no replacement, the enterprise’s total shared-knowledge account will have been diminished.

If, on the other hand, the business replaces the departing employee with one who has just as large a fund of institutional knowledge, or larger, only it’s a fund accumulated in different institutions, then the enterprise’s shared-knowledge account will increase.

It’s permeability in action, even without any electronic knowledge sharing. Imagine the company chart of accounts had a way to track shared knowledge. Think its executives might make different staffing decisions?

It would be an intriguing exercise in finance, figuring out how to tote up all of the valuable knowledge held in an organization. The trickiest part wouldn’t be how to put a number on it. Not that this would be easy, understand, but given how many non-disclosure agreements claim that revealing any of it would cause irreparable harm, you’d think someone would know how big a number “irreparable” is, at least approximately.

Not to keep you in suspense, here’s what would be the trickiest part: In a cognitive enterprise, knowledge is widely shared — it’s what the whole organization knows that counts, not just what an individual who works there knows.

Which gets to one of my own trade secrets, which I’m allowed to share with you because it was knowledge I had that preceded my joining Dell Services: No matter what the challenge or issue, there are employees who know all about it and what to do about it. Their problem, and one of my best ways of earning my keep as a consultant, is that until my team and I show up, nobody has any interest in what they have to say.

To be fair, after my teams and I show up and do listen to them, putting it all together into a nice, coherent narrative and plan, very often client leadership doesn’t want to hear it from us, either. It is, I guess, cognition prevention at the highest levels of leadership.

This is also why embracing permeability is a safe knowledge management tactic: If your company’s stuff makes it into, for example, a LinkedIn discussion forum where the employees of other companies read all about it, you have little to worry about.

The odds are long nobody will listen to them after your employees have made them smarter. If you’re smart, you won’t duplicate that mistake.

So stop trying to protect your own IP and learn from all those other folks who are sharing theirs.

Once more thing. If you think this week’s KJR is worth sharing, please do so. Just make sure to respect the copyright notice at the bottom when you do.

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