This article highlights best practices of highly technical, yet productive teams in a development aerospace community from a training and human resource management perspective. One team was considered successful in that it completed all of the milestones and demonstrated superior innovative efforts in doing so, while the other was less than successful in the categories of meeting the objectives in the schedule, budget, and overall end-item deliverables. Transfer of tacit knowledge and co-location strategies are discussed with implications for success for technical teams.
Why Intellectual Capital Matters
Intellectual capital combines the idea of intellectual capacity with the economic concept of capital; it includes the skills and knowledge that a company has developed for the production of goods or services and is an essential component of organizational management. The concept of intellectual property further highlights the importance of intellectual capital and its role in moving competition forward, hence creating the opportunity for the company to advance competitively.
As partnering and outsourcing become more prevalent, customers, suppliers, and distributors of information are sharing data at unprecedented levels. Collaborative efforts between previously disparate knowledge asset groups (for example, customers and vendors) create new synergies that allow for additional insights. For example, a U.S. National Aeronautics and Space Administration (NASA) propulsion system contract for design and manufacturing may be awarded to one company, but that company most likely does not house all of the leading-edge knowledge and assets that are required to design and build the entire system. The company must hire subcontractors to provide the parts and manufacturing that will be used to operate the overall system. When changes to the propulsion system are handed down from NASA, it creates a ripple effect as the changes are communicated and managed among all of the subcontractors. The only successful means of managing the overall design effectively is to allow information sharing among the subunits.
Tacit knowledge can be defined as intellectual capital possessed by an individual that is difficult to communicate to the rest of the organization. It is the unspoken “know-how” underlying the functions of a person’s job or an organization that is not easily shared but nonetheless critical to an organization. The opposite of tacit knowledge is codified knowledge, for example, the blue prints or drawings used in a design. A company’s unique processes of conducting business are not always captured in its relevant routines, which is why the transfer of tacit knowledge is so critical: it is the differentiating factor for many successful firms. In the aerospace industry, for example, a contract may be awarded to a select team with a partial incentive that is contingent upon keeping specific team members together because only they possess the necessary tacit knowledge to complete the project.
The best organizational structure for the transfer of tacit knowledge is one that facilitates swift decisions, provides incentives, and possesses a low bureaucracy quotient. Projects and programs are time-sensitive and there is often only limited time available to provide value-added insight to projects. If the time allotted for a project is dominated by non-value-added procedures, such as dealing with bureaucratic “red tape,” those tasks will detract from the overall time given for a project. Limiting bureaucracy may aid the transmission of tacit knowledge, but may also entail significant sacrifices.
The issues surrounding the transfer and capture of tacit knowledge are confounded by the frequent practice of documenting work instructions, but not the environment in which they are executed. For example, changing a documented process may require several levels of review and approval, no matter how minor. In reality, however, these changes are often so minor that the time required for such reviews and approval is not feasible and so the change is made without adhering to the codified procedure. Oftentimes, a company will decide to move forward with the project until there are a substantial number of these minor changes that can then be lumped together and, at this point, the review and approval of these changes is nothing more than a formality. In this way, tacit knowledge contrasts with the codified procedures for managing and moving the project forward. Many firms will take a complex task and simply map each step, but this usually ends up being a misrepresentation of the actual process in its proper context, which can result in problems with replicating the process.
A strong analogy of this phenomenon is offered by employee job descriptions. Rarely is a job description all-inclusive, nor does it tell the “how” of completing the job’s required tasks. New employees are provided with these supposed job maps and are then held responsible for achieving the desired results, even though their actual work conditions or environment may differ. This parallels work instructions that attempt to capture practices of learning and innovation. Environments change, rendering previously relevant instructive processes inaccurate for new employees. Unfortunately, the processes are difficult to change, further hindering the employee’s ability to complete the given tasks. The result is that the person completing the task adheres to the process and fails or he or she is prevented from using innovation to complete the task, given the existing environmental conditions. If the employee deviates from the original process, this deviation may be interpreted as a failure because the design instructions require total adherence. This process can thus be a very difficult balancing act for an employee because the dynamic between inflexible practices and innovation is often disruptive. The aforementioned research also shows that even though collaborative work is a team effort, many times, a team’s success is “credited” to one member. This in turn creates a barrier for other team members seeking to share information and collaborate on the project, which affects the team’s synergy and its ultimate success.
Research on Recent Trends
Two teams within the tier-two aerospace industry that shared certain qualities in common, namely their size, composition, project timeframe, and end-item deliverable product, were analyzed in regard to their social networking. The teams were both structured based on a cross-function composition, with the same core team roles, and both projects’ timeframes were approximately three years. One team was considered successful, while the other was deemed less than successful in terms of meeting schedule, budget, and overall end-item deliverable objectives. Before arriving at this conclusion, the researchers conducted in-depth interviews, social network analyses, and statistical analyses of the two teams. The interviews were semi-structured, meaning that they consisted of standard questions as well as open-ended questions that could lead the conversation in different directions, depending on the interviewee. Each team consisted of approximately five to 150 members, depending on the life cycle of the program. These teams were analyzed based on the data collected every month from their time-card practices. The company’s timekeeping practices require each employee to record each hour they expend on a weekly basis. This data is then captured on a monthly report that can be sorted and analyzed for each project conducted within the company. For this study, the data was captured from the first month to the end of the life cycle of the project (approximately 50 months later).
Each team was assigned an end-item deliverable of a propulsion system, similar in structure and innovation. Though these two teams were engaged in the development of the end-item deliverable, based on the company’s definition of the project, they were actually involved in a “production and development” project. This distinction has a profound impact on the procedures that the team must adhere to; resembling those of a full production program. However, in the production phase of major aerospace programs, work instructions are typically the key to a team’s performance. In the development phase, one would expect few if any mandatory work instructions, but rather common practices to help navigate the process. This was not the reality for the team members studied in this article, though, due to how the teams were defined, a process driven by union negotiations within the researched company.
For each company, the core team was identified according to its role, commitment, and formation. There were more than 250 different personnel who supported each team, but the following were deemed critical to the design and manufacturing phase: lead project engineer, systems engineer, mechanical engineer, design engineer, and manufacturing engineer. The majority of the learning and innovation conducted during the system design process was derived from these core team members working together to achieve a leading-edge solution””even as the requirements for the system’s construction and manufacture changed. After the core team members were identified, they were interviewed on a host of different topics related to the above-mentioned projects. The necessary precautionary measures were taken regarding the length of the interviews, potential biases, the structure of the questions, etc., and the main findings were then derived from these interviews.
The results of these interviews revealed that, oftentimes, a team member would interact with another member early on, but later, that relationship would cease to exist. A conservative approach was used to define the relationship that existed after the project ended, that is, after the last interaction between the two team members was captured. A more liberal approach would have been to document the relationship from the first interaction all the way through to the last.
The Findings of the Study
The preliminary findings of the study showed that, based on the in-depth interviews, the organization’s environment played a critical role in the team’s success. Several key success factors included the team’s isolation from the rest of the company, the organization’s political nature, and the level of bureaucracy. The key areas for managers to consider are outlined below.
1. Co-location removes the team from the hindrances found in the rest of the company.
At this company, the in-depth interviews revealed that employees are typically housed based on their function, but when they are assigned to a particular program or project, all of the members of the resulting cross-functional team assemble in a central area for the duration of the project. This process is known as co-location. The successful team co-located to an area that was separate from the company’s engineering team so that they had limited interaction with others, whereas the unsuccessful team did not. The co-location effort seemed to lower and almost eliminate the level of bureaucracy the the team was exposed to. Additionally, it aided the team by facilitating swift decisions and providing new incentives for higher productivity and superior performance. The key difference of co-location, as it is defined within this research, is not only that the team is located together, but also that the team is isolated (in a separate building) from the remainder of the organization. This critical, yet minor, distinction must be made to fully convey the profound effect an organization and its infrastructure can have on a high-performing team.
2. Incentives for higher-level employees are intrinsic.
Most interestingly, the biggest incentives cited by the employees were working with their their fellow team members and the environment in which the program was completed. According to one core team member, “The incentive of working on this team is that I am working with a group that is a cut above and we work so well together.” Further discussion revealed that a key advantage of the successful team was the leaders within the team. “The project engineer had a way of keeping management at arm’s length and letting us be successful. That made the program successful and a pleasure to work on,” said another core team member.
These incentives were entirely focused on the environment in which the team worked, rather than on any monetary compensation. When discussing the particulars with the above-mentioned project engineer, he reiterated that co-location was critical in encouraging communication among team members and that isolation allowed the focus to remain on the program, rather than the organization as a whole.
3. Member integration from the start team facilitates effective communication.
All team members play a critical role, although some may only be needed at certain times within the life cycle of the program. In the successful team, the design and quality engineers were brought in for more than just the one time in which their key functions and roles were seen as most traditionally critical, as the team felt that these engineers needed to be close to the other interactions as well. This helped to foster a direct relationship between the unit’s manufacturing and documentation. Each member that was co-located was seen as an essential component of maintaining the productivity of the team, even though some members were in more supportive roles. This approach varies greatly from the traditional method of only integrating a team member when he or she is needed to actually design, build, or “work” on the project, as revealed by the in-depth interviews.
Managers will look at tangible resources and the bottom line to determine best practices and incentives, as these are easily quantifiable factors. This study illustrates how the intangible aspects of a company, such as the environment and the team members, can also serve as incentives for employees, and in turn, increase productivity. Each company possesses these assets and can exploit them to increase their success, though many times, long-standing traditions and historical norms have paved the foundation of many firms, making the implementation of these changes difficult. In today’s changing environment, new and oftentimes novel approaches to personnel management must be identified and implemented to facilitate the leading-edge efforts that are necessary for a company to remain competitive. Manufacturing and operational excellence can only go so far, as opportunities exist in increasing productivity by increasing communication channels.
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 Teece, David J., “Capturing Value From Knowledge Assets: The New Economy, Markets for Know-How and Intangible Assets,” California Management Review, 40, no. 3 (1998): 55–79.