Knowledge Bank Blog, Finding New Ideas

Implicit vs Explicit Knowledge

Have you codified the rules for winning?

How does a McDonald’s cheeseburger taste exactly the same in whichever store, or whichever country, you have it?  Is it left to thousands of McDonald’s staff to make what they think is a good cheeseburger and hope it ends up OK?  Of course not.  McDonald’s are crystal clear on how to make a cheeseburger, or any of their other products for that matter, and they have a specific set of guidelines that staff follow.

This breeds consistency.  And whatever you think of McDonald’s, it is hard to argue against the consistency with which they deliver day in, day out.  The only way they can do this, is by turning implicit knowledge (a few people know how to make a cheeseburger) into explicit knowledge (everyone who needs to know, knows).

We think a lot of companies are loaded with implicit knowledge.  We’ve lost count of the number of companies who say ‘if only we knew what we knew’.  This knowledge sits in people’s heads, is buried somewhere on the network or in page 102 of the 150 slide presentation.  Or it may sit with experts.  Experts are great, because they solve issues very quickly.  But they are also dangerous, they hold the keys to getting things done.  If they don’t impart their knowledge, once the expert has moved on, so too has the knowledge.

Fewer companies have explicit knowledge.  Unless your business model depends on it, like McDonald’s, there is rarely the urgency to create it.  But if you haven’t got explicit knowledge then how do you make sure that what you know gets applied?

We think there are 3 things that companies need to do to change this.  Firstly, you need to know what you know on a particular subject or issue.  Secondly, you need to know what to do – have clear guidelines for strategy and execution.  Thirdly you need to do it consistently across location and time.

So, how do you get to this point?  How do you turn implicit knowledge into explicit knowledge?

Distil.  Boil things down.  What are the key insights you have on X?  What are the secrets of success or golden rules to follow?  Whether that is the 5 rules for winning in breakfast, which Quaker Oats follow.  Or the rules for launching NPD for maximum shopper impact – which Gillette follow.  Or the rules for Point Of Sale design – which Coca Cola follow.  We call this ‘codifying’.

Package.  Turn this knowledge into a simple framework that the relevant people can understand and apply.  This builds on what we talked about last week – simplicity, specificity, memorability and consistency.  McDonald’s don’t give staff a huge manual and ask them to find the relevant rules for making a cheeseburger.  They give them a simple guide that can be followed each time.  And after you have followed the guide a few times it becomes baked into how you do things.  Everyone who needs to understand it, does understand it.  Whether those people sit in the boardroom or are working on the shop floor.

Land.  Get it integrated into the way the Business operates.  Who – which functions or specific people own it?  Where – which process or activity?  When – timing in the year or in the process flow?  How – will it be built into the process or activities?  This is key to making things happen consistently.

There is a premium placed in our industry on ‘new’.  Find something new and interesting then move on to the next new and interesting thing.  This means we often overvalue ‘new’ and undervalue ‘important’.  We think we already know ‘important’.  But do we really?

Taking this approach is not about dumbing things down and making the world a boring place.  It is about focusing on the right things, the things that are key to winning with consumers and shoppers.  Then executing against that consistently.  And if that sounds boring, to borrow from Jose Mourinho, ‘boring is not winning’.

Feel free to forward.  Have a great weekend and speak to you next week