PERF RMANCE 04 - The Performance Portal - Ernst & Young

Connection as competitive
advantage
Studies have shown that the help seeker
must have enough knowledge of the
formal and informal structure of the
organization to find the right colleague
with the right answer — and if they do
not, the resulting “information search
cost” has a bottom-line impact in lost
productivity for all concerned, lowered
morale due to frustration, as well as other
perceived “social costs” such as furthering
a perception of incompetence (Bulkley
2007, Lee 2002). Multiply this isolated
issue across the whole organization and the
potential for widespread inefficiency due to
the lack of connection between colleagues
quickly becomes evident.
The fact that enterprise-wide inefficiencies
of this kind exist is not exactly news. In
fact, most executives could likely recount
as many examples of how their efforts
have been hampered by the scale of
their organization as they could give
examples of that leverage successfully
harnessed. And yet, despite the apparent,
commonsense value of connection, most
large organizations lack an effective,
scalable employee connection and network
development strategy.
Why might having a coherent strategy and
mechanism for connecting employees be
important? In “Wellsprings of Knowledge”
Dorothy Leonard (1995) used the term
creative abrasion to describe one of four
key activities necessary to sustain the flow
of intelligence across an enterprise, thereby
producing value. In Leonard’s research,
integrating problem-solving across business
units enabled new levels of creativity and
innovation. This was the direct result of
having made reasonably possible use
of the incredible diversity of knowledge
existing within the organization. It is
only in a connected organization, where
leadership has invested in the white space
between colleagues, that information,
knowledge and intellectual capital can
flow in a capillary network between a
colleague’s communities and networks,
and the leveraging of scale can happen
spontaneously, from the ground up.
When connections are successfully
encouraged, those handicaps so often
experienced by larger organizations instead
become strengths. It is specifically the
size of the organization which provides a
significant opportunity for engagement and
the formation of cross-boundary networks
that leading thinkers from Granovetter
to McAfee to Leonard have marked as
essential to high performance.
“It is only in a connected
organization, where leadership
has invested in the white
space between colleagues,
that the leveraging of scale
can happen spontaneously,
from the ground up.”
39