Knowledge, Innovation and Development



   [pic]



                                   The KID


                      Written by: Kuropatkina Serafima



                              Saint-Petersburg
                                    1998

 ( Kuropatkina S.N.

Moving into the future

Knowledge is the thing that makes  a  difference.  It  is  matter  of  being
better informed than the others, getting ideas before the  others,  -  these
are the things that allow some companies to take off and remain leaders  for
a long time. In the past knowledge and innovations didn't play an  important
role in company management. The impact of these factors on  the  competition
wasn't  very  big  and  obvious.  From  the  second  half  of  19th  century
industries and management started to develop rapidly and by the end of  20th
century inventions have penetrated all spheres of production,  business  and
human life in general. Competition has dramatically increased, creating  the
necessity for each company to improve and develop constantly. We are  moving
into the future where it is not possible to win the game  using  traditional
methods. This proves a need of a  separate  structure  within  each  company
that would deal with existing knowledge, innovative  ideas,  development  of
production process and working life. It is essential to design a  completely
new department. Lets call it - the department of Knowledge, Innovation  and
Development (KID). This system also will allow the  company  to  avoid  high
opportunity costs of not doing some improvements which  could  reduce  costs
and give rise to profits. Let's take a close look  on  the  KID  department,
its functions and structure.

The department of Knowledge, Innovation and        Development (KID)


1 KID's functions

The general functions of the KID are:
to solve different problems that come up in a company  using  known  methods
or new ideas of the employees;
to constantly develop company's production cycle and  products
to  give  aid  to  all  departments  concerning  possible  improvement   and
elimination of drawbacks
In order to fulfill its general functions KID will carry out  the  following
subfunctions:
receiving fresh ideas or problems from staff of different departments
selecting the most useful and relevant ideas and checking the  existence  of
the problem
developing ideas and problem solutions (if needed) to  level  required   for
implementation
making the final decision in cooperation with the department(s) involved
implementing the developed idea
controlling the implementation process, altering if necessary
evaluating the outcome, calculating financial results
rewarding the idea maker
changing the corporate culture and working  environment  towards  creativity
and innovation values.

2 Structure of the KID department

In correspondence with its main activities the KID  should  consist  of  the
following departments:
1) gathering and filtering department (organizes  research,  selects  ideas,
   checks  the  relevance  of  problems,  responds  to  idea  proposers  and
   customers)
2) developing department (works out solutions to  problems  pointed  out  by
   employees  or  customers,  invites  authors  of  good  ideas  for  closer
   cooperation)
3) executive  department  (plans,  runs,  controls  implementation  process,
   negotiates with other departments)
4) social relations department  (deals  with  motivation,  awards,  customer
   relations and different social activities)
At first the department 2) should closely cooperate  with  present  R&D.  In
the future R&D can become subject to 2).

How to create a KID?

Creation of KID must be  supported  on  the  highest  level  of  management.
Without this nothing can happen.

1 Preliminary activities

First we must analyze how innovative is the company. How often changes  take
place. Who proposes them. How do workers feel about sharing  the  ideas.  Do
their ideas get attention? This will show the present  situation  and  allow
us to estimate the how much time and resources KID creation will take.
Next step is to introduce to everyone in the company the new department,  to
explain its purpose and functions, to show how the company and every  single
employee will benefit from it.
Then allocate the people and resources and  create  the  department  itself.
For the beginning KID can be formed with existing managers and experts.  But
when many companies are going to be using similar  systems  they  will  need
specially trained workers. Faculties should be designed in universities  and
colleges teaching students to deal  with  new  ideas  and  to  use  existing
theories  and  experience  of   preceding  generations  in  order  to  solve
problems and develop their company.

2 Designing information flows

 As a  part  of  organizations  information  system  we  must  work  out  a
mechanism of idea and problem flow from the employees and customers  to  the
KID. Among the numerous motivation theories there are theory  X  and  theory
Y. X suggests that the worker is passive and needs to be closely  controlled
and forced in order to get results. Y - the worker is creative and eager  to
work. He just needs proper conditions to show himself.  I  went  further.  I
believe that there are two types of workers  in  the  company  -  X  and  Y,
active and passive. That's why the KID needs two approaches. For example:
open entry - every worker can come to the gathering department  directly  or
put his ideas in written form into special bins that would be  available  at
his working place. This way the employees will  be  able  to  express  their
thoughts at any desired time;
obligatory interviewing - from time to time KID will  give  out  to  workers
questioners which they must fill.  These  could  consist  of  the  following
questions:
"Have you noticed any problems concerning the work of your department?  Have
you any suggestions on how to solve them?"
"Is there anything you'd like to improve  in  your  department  and  in  the
whole company? How (your suggestions)?"
"How do you feel about our companys products (services)? How  can  they  be
developed or improved?" Etc.

The interviewing should be carried out at all departments, but  not  at  the
same time. This will  allow  to  avoid  conjunction  at  the  gathering  and
filtering department.

3 Motivation

Motivation of the workers. We must estimate the level  of  actual  needs  of
employees and develop a mechanism of motivation universal for every  worker.
There  can  be  many  motivating  factors.  They  depend  on  the   economic
conditions in the country, standards of living and  financial  situation  in
the company. Money, job promotion, board  of  honor,  competition  of  ideas
with prizes, etc. Motivation through corporate culture is also required.  We
can put posters in often visited places. Posters may say:
"By participating the KID's activities you will help your  company,  improve
your work and life!"
"Be company patriotic!"
"Be a perfectionist. Spot a problem - tell the KID about it!"
"Give us ideas because nobody knows your work better then you!"
etc.

4 Cooperation with experts

We need to organize cooperation with specialists. It isn't  useful  to  have
our own staff of experts because:
they will not always be logged with work and this will produce extra costs
they will soon become useless because they will be drawn away  from  current
work of their departments.
We also must investigate whom we can rely on.  Not  all  experts  innovative
and understand the necessity of change. Cooperation with KID  will  be  part
of responsibilities of those experts who work with it.
Organize cooperation with management of different departments. An  order  to
implement any idea must come directly from the management of the  department
involved.

5 KID's position within the company

The scheme of KID's position in the company can look like this:



Kid provides  each  department  with  its  services.  Department  in  return
provide KID with some information, resources etc. The connections are:
1.  Marketing  department  provides  information  received  from   different
  marketing research. Specifies the situation on the market. Gives feedback
  on KID's activities (have the sales increased? how much?)
1.  Production  department  gives  feedback  on   KID's   activities    (has
  productivity increased? how much?)
1. Human resource  administration cooperates  with  KID  closely.  Helps  it
  with motivation.
1. Financial department provides KID with money for all  activities  (within
  the budget of course). Gives  feedback  on  KID's  activities  (financial
  results figures, information about changes in costs and revenues).
1. Customers give KID valuable feedback about products and services.
1. Employees give KID ideas, cooperate  with  it  and  receive  rewards  for
  their work.
1. Experts work with KID on specific problems.

6 Control functions of the KID

If  the  innovation  is  complex  we  must  monitor  closely  the  field  of
implementation and if problems occur - take care of them immediately.
Collect feedback from all people  related  concerning  the  results.  Taking
action  if  necessary.  Remember  that  no  change  comes  without  negative
response. Calculate results (based  on  financial  information,  information
about productivity and costs, etc.). Reward the  idea  author  depending  on
these figures. Tell everyone about  this  "great  man,  who  helped  to  the
company so much".

7 Customer relations

Customer feedback must also come  to  the  KID,  not  marketing  department.
Marketing department doesnt have direct  stimulus  to  analyze  information
related to other departments. It might have difficulties making  changes  in
other departments due to lack of power.

The KID system is not of course ideal. It is just a draft, an idea  of  what
could be developed into a universal model. But as I see it -  every  company
that wants to succeed in the coming high-tech future must start  to  develop
such a system as soon as possible.
-----------------------
                                      2

                                      1

                                      5

                                      4

                                      3

                                      7

                                      6

                                    BOARD

                                   Finance

                                  HR admin.

                                 Production

                                  Marketing

                                     KID

                                  Customers

                                   Experts

                                  Employees




"Knowledge, Innovation and Development "