Dare to be different

Knowledge management can drive innovation within those law firms that actively encourage their people to experiment with new ways of working - even going so far as to promote risk taking and allowing for occasional mistakes. The techniques for making truly innovative ideas become a reality are established, but are firms brave enough to make the jump from KM as a 'nice to have'? By Andrew Trickett

Innovation is usually defined as the creation of something new – for organisations it is usually a change in products and processes; or in law firms, a change in a service.

Law firms now deal in a more competitive marketplace not only in terms of globalisation but also with the oncoming liberalisation of the legal sector. Also, the lifecycle of services is diminishing as competitors quickly copy and reverse-engineer what was once innovative.

In this hyper-competitive world, we should consider Austrian economist Joseph Schumpeter’s observation that innovation is hard to produce and harder to sustain and that businesses stand on ground that is “crumbling beneath their feet”.

I have worked in organisations that didn’t innovate and no longer exist in their once dominant state. Too often they were complacent and fell into a comfort zone thinking that because they were dominant in their market, their competitors would not succeed.

Organisations that do not innovate destroy the value of their company and the business lurches towards commoditisation and away from premium pricing. Innovative companies are also more likely to retain people. If a law firm has energy and encourages innovation then its people, given the choice, would be happier to work in an organisation that was thriving, interesting and full of challenges, rather than one that considers the status quo the way forward.

Lawyers are innovative and as the law changes then new markets evolve. A few years ago, who had heard of phrases like sukuk, murabaha and haram – the lingua franca of the new market of Islamic Finance, based in London. However as knowledge-management (KM) practitioners in the legal market, we acknowledge that there are barriers to KM and it is interesting to note that some of these barriers also affect innovation:

1. Culture – we know that if a firm has an open culture and is open to embracing new experiences, then this can be difficult to replicate and is therefore a source of sustainable competitive advantage to that firm;
2. Many organisations have also bought into the concept of continuous improvement, or kaizen (or, as I call it, ‘small I’). However, they neglect to remember that all products/services have a finite life. We can continuously improve by all manner of techniques a 33rpm long-playing record by making it thinner or cramming extras on it – it does not disguise the fact that there is no major market for it. We must therefore remember the second half of the equation where the big innovation takes place – the Japanese call it kaikaku – and not only rely on kaizen to deliver innovation to our product in the long run;
3. The third barrier relates to collaboration and what I call the ‘team-player paradox’. If economic times are hard, people tend to hoard knowledge feeling that they are securing their future in the firm. However, showing that you are a team player and disseminating knowledge to work colleagues is more likely to show success as you highlight that you are a key knowledge resource. Unfortunately, as my niece reminded me recently, our schools don’t always encourage collaboration between people and call it cheating. So what children are told to avoid in school, we, as knowledge-based organisations, want them to practice in the work place. From research we know that from collaboration comes the dissemination of shared experiences, and through this, innovation;
4. The fourth barrier comes from fear of failure and, to the professional mind, the fear of saying ‘I don’t know’. Senior managers in your organisation need to encourage failure to some extent – encourage risk and see what happens. If your firm celebrates failure then people will feel emboldened to take more risks and develop innovation. James Dyson’s vacuum cleaner took 5,127 attempts before it was completed. How many law firms would accept that level of delay? They need to understand that success doesn’t come in one mighty bound but occasionally is graduated. Rome wasn’t built in a day.

Fostering innovation
I was reading an article by business writer Seth Godin, in which he highlighted that organisations might recruit bright people to work for them but they are in danger of becoming sheep-walkers due to those that do not encourage innovation. My view is that an innovative enterprise galvanizes people. The good thing from a firm’s viewpoint is that naturally most human beings want to improve – it is hardwired into us but regrettably organisations do sometimes get in the way.

Effectively, what law firms need to understand is that to encourage innovation as well as knowledge sharing, they must recognise the importance of giving people time to think, allow them to relax and, most importantly of all, provide recognition for their efforts.

When I was talking to a friend recently, he felt that lawyers were traditionally poor innovators. This is surprising, as law firms tend to recruit some of the brightest minds and also have access to a pool of external talent. He is an entrepreneur and highlighted that an entrepreneur tends to deal with the imperfect idea, whereas lawyers by the very nature of their jobs have to work to achieve perfection.

Also, due to the nature of the partnership organisational structure, there is a tendency to herd and to look for the consensual way forward.

Innovation tends to come from organisations encouraging positive deviants – the people who turn left when everybody goes right, or use an Apple Mac when others use a PC. These deviants have a positive role in the firm and can warn people of the dangers of clinging to the status quo, and envision the rewards of embracing a radical but different future.

However, in most organisations rather than being praised and becoming corporate heroes, they are considered Cassandra’s and are all too often forced out – taking their innovative ideas elsewhere while the company they leave behind wallows in it’s own complacency.

Also, the use of the billable-hour model often encourages people within law firms to become slaves to that rhythm. Law firms desire creativity and innovation but it can be difficult in a firm where the emphasis is to be quick, but often results in ‘dead tired’ staff. Hence people are more likely to be suffering from cognitive dysfunction and higher rates of error than producing innovation.

So are there KM techniques that can be utilised to encourage innovation? There are a number, such as using debriefing after the end of every major project to learn lessons and to identify innovation.

However, for the purposes of this article, I wish to introduce the concept of the Watson Group (named after Bell’s assistant, Thomas Watson, who worked with him in inventing the telephone) and the use of the ‘innovation time account’.

The Watson Group concept
On many occasions in a meeting, I have observed that junior members of the group tend to be silent – not willing to stick their head above the parapet and propose new ideas, usually for one of the reasons cited earlier inthis article.

However, following research and observation I have found that junior people are more likely to broach ideas in an atmosphere that they find less threatening.

A ‘Watson Group’ would be a team made up of their peers and based around the concept that there is no bad idea, only not articulating an idea. Ideas are discussed and approved through lively but respectful conversation where people suggest ideas and discuss their thoughts, be it a change of process or an idea for a new service.

Once this has been approved by the collective, the idea can be submitted to senior management in the knowledge that it has been tested and has the full support of the collective group. As on MBA courses, it can provide people with the opportunity to ‘play’ and explore options that may not have been considered before, along with the opportunity for the information to be looked at by new pairs of eyes.

Management can be invited to attend the meeting. One area that is often overlooked is getting people from other departments to attend – for example, business development and finance – which can often provide valuable input and also bring a more business-focused perspective to the group. They can also act as ideas mentors, helping people to develop plans that will assist in obtaining senior-management approval. A very radical step would be allowing client input in order that people look outside the boundaries of the firm and see the idea from a different perspective, by standing in the shoes of the client. A client might well be interested in this as, ultimately, they have a vested interest in your law firm’s innovations.

The final element is that of recognition: people will provide innovative ideas so long as they are recognised for it. A lot of junior staff are concerned that senior management will take the credit for their idea. By articulating the idea in a Watson Group, you are then recognised by your peers, but also it acts as security that the idea will be credited to you.

In respect of the innovation account, innovative companies like 3M provide people with time to work on renewal and reflection. It cannot be right that the maximum time that lawyers have to spend on professional development is less than 20 hours in a year. What would be the effect of people having two hours a week to read and reflect, or get involved in a Watson Group, in your firm? I believe from experience that using this variation on a KM technique would be beneficial in the long run. It would highlight the importance that the firm placed on innovation rather than just paying lip service. Law firms need to appreciate innovation and that comes from having the courage to trust their staff and to give them time to think, along with the ability to relax, and to recognise them when they produce an idea.

We are moving rapidly from the information age to the knowledge age and it is our role as KM practitioners to help people to become more innovative through our toolbox of techniques, so that our organisations see us as providers of a value-added service, rather than a ‘nice to have.’

We need to encourage and support people to share firstly knowledge and then potentially innovation, by connecting with other people across the silos. Then we need to provide them with the time and techniques to share existing, or to create new, knowledge either individually or collaboratively. As a result of these processes we can then collect the profits from resulting innovations, or from the law firm having faster knowledge recovery than its competitors in the future.

But my final question is this: are we and the organisations that we work for ready for that jump or will we still see KM as a nice to have?

Andrew Trickett was formerly knowledge manager at UK firm Wragge & Co. This article is written from a personal perspective, based on his recent presentation at Ark Group’s ‘Knowledge Management in the Legal Profession’ conference.