Organizational Memory as a Competitive Advantage

ForgetIT EU-Forschungsprojekt Abstract: This article develops an approach to bring the beauty of human memory to organizational memory design. Designing the practices and processes of organizational memory can improve an organization's competitive position. The model of the organizational memory cube is proposed for a first classification to show the road to becoming a more data-driven organization through memory design.

The Beauty of Human Memory

Human remembering is one of the most powerful features of the human intellect. It gives individuals a chance to relate to the past and to the passing of time. Things that happened in the past are not always gone completely, some of them we remember. It enables us to see our lives as progressing. Some scholars have argued that only when we see time as progressing linearly, we begin to take full responsibility of our lives, realizing that our individual destiny in this life is not preordained, but can be shaped. Martin Luther built on this, and so did the disciples of the enlightenment. Even though – as some researchers have pointed out – realizing the linearity of time may be much older than assumed, it would be impossible without human remembering.

Equally important, albeit less written about, is human forgetting: our brain’s ability to rid itself of surfeit memory. It’s not perfect, but it works remarkably well. And as we forget excessive details, we gain the extremely valuable ability to remember the important. Forgetting permits us to disregard the trees, so that we can see the forest: as we rid ourselves of details we can focus on the big picture. Generalizing and abstracting is crucial for human progress, but it rests not only on our ability to observe and remember, but also to forget.

It is thus the intertwining of remembering and forgetting that has made human memory so successful. And it is understandable that we would like our organizations to be just as adapt at remembering and forgetting.

Organizational Memory Design – The Baseline Challenge

Organizations are useful structures through which humans can coordinate their activities. They are therefore “human” in the sense that human beings are a central ingredient. But unlike human memory, the structures and processes that operate on organizational memory are more plastic. They can be designed and shaped, including through deliberate action, many different ways.

With humans, our remembering and forgetting processes are “built-in”; of course, we can shape our memory, for instance by remembering certain events frequently thus easing retrieval. But this is a shaping of the memory, not a shaping of the processes and structures that create human memory. These are pretty much fixed.

This additional layer of flexibility in how organizational memory is being created and maintained can be a significant advantage. Organizations, unlike humans can choose – at least to an extent – their processes and structures of remembering (and forgetting). This is possible because organizations, although humans are a key component of them, are not just made of humans. They also capture standardized routines and behaviors that create memory artifacts outside of the human mind.

At the same token, this flexibility poses also a unique challenge: unlike with humans, there is no obvious “baseline”, no obvious standard or best practice of organizational remembering and forgetting. In fact, it is quite likely that different organizations have different needs of remembering and forgetting, and these specific needs can be inscribed in that organization’s memory processes and structures. For instance, a space agency may want to remember lessons learned from designing previous spacecraft. In contrast, a company focused very strongly on disruptive innovation may want to remember less, so as to not be too constrained in designing its “next big thing”.

Identifying the organization-specific “sweet spot” of organizational memory is thus key to turning the baseline challenge of organizational memory into an opportunity, and organizational memory into a competitive asset.

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Operationalizing Organizational Memory Design

The enticing opportunity to use organizational memory to enhance the competitiveness of an organization rests on three distinct procedural steps.

In the first step, the organization’s existing memory structures and processes are captured and analyzed to establish a baseline of the current situation. Ideally, this task is accomplished without too heavy and time-consuming an intervention, relying as much as possible on data – either existing or collectable – reflecting specific “memory behavior” in the organization. Such passive data gathering can be supplemented with interviews of a cross-section of human actors in the organization if there are concerns that the passive data gathering method is insufficient.

The second step is about understanding the aspirations of an organization when it comes to organizational memory: Where does a specific organization want to be regarding its own memory processes, structures and behaviors? Of course, data on the exact size and shape, as well as the direction of such aspirations cannot be captured passively, they must be elicited by the organization’s management. Data may, however, helpfully point at tensions inside the organizations for instance between the memory behavior of management versus memory behavior of the rest of the organization, or tensions in memory behavior between different parts of the organization. Confronted with such data, management may amend its organizational memory aspirations and preferences, or at the very least reflect on the revealed actual practices and how they differ across the organization.

The third step is to take the delta between the “is” and the “ought” of memory behaviors in an organization, and to think about how processes and structures can be shaped so that they move this organization’s existing dealing with memory (as captured in step one) closer and closer to the desired goal (as defined in step two). This step, in other words, is about deliberately shaping an organization’s memory practices.

In a nutshell, the first step can be described as a diagnostic tool that helps management understand where an organization is regarding its handling of memory. The second step is about defining goals, while the third step is about setting up a strategy that helps an organization move its status quo to its desired organizational memory “sweet spot”.

If organizational memory is understood as providing organizations with an opportunity to improve their competitive position, then operationalizing organizational memory design through these three steps is a highly effective way of facilitating competitive change inside an organization.

Outside In – Helping Organizations to See the Difference

Clearly, mapping out concrete steps for an organization to achieve a competitive advantage through deliberate design of its organizational remembering (and forgetting) is important. But it is not sufficient. These steps actually have to be taken. And this is precisely where it gets difficult. Because organizations are designed to be stable and persistent, rather than malleable and flexible – that’s what organizations are made for: to withstand shifts and swings, and to offer strength through stability. Therefore, it is very hard for organizations by themselves to engage in a process of internally prompted change and adaptation. It does not happen very often, because most individuals within an organization believe they lose with change. In fact, if organizations change at all, it is mostly not an internal pro-active process, but a reaction to outside pressure, a consequence of changes in the competitive context that makes organizations adapt or decline and become irrelevant.

At the same token, pro-active change undertaken at a time chosen by the organization itself is eminently preferable to change imposed from the outside at an inopportune moment by fundamental shift in the competitive landscape. Moreover, pro-active change may be easier, cheaper, and more deliberate than having to react in record time to fend off sudden outside pressure. And yet, despite all of its advantages, pro-active change rarely happens. In part this is because such change frequently has no agent, no lobbyist, no prominent stakeholder inside the organization that can actively push and carry it through irrespective of their own position within the organization.

This conundrum actually points to an opportunity: a chance for an outside third party to come in and help an organization to initiate and manage a process of pro-active change, at its own pace and with its own goals in sight. Consulting companies have helped organizations to change for decades. This is a well understood recipe. What is new, however, is the context of where this change may happen. We suggest here that designing the practices and processes of organizational memory is an avenue of change for organizations, and thus an avenue for third party consultancies to facilitate that change.

Change management focused on organizational memory processes is not something existing management and strategy consultancies have undertaken so far – and with good reason: because they have neither recognized organizational memory as a source of competitive advantage, nor have they developed the conceptual understanding or the necessary tools to aid and support organizations in such memory design. In fact, it can be argued that rather than conventional management consultancies, providers of information management services to organizations may have better conceptual expertise and more suitable organization-specific knowledge to perform this task than their general management consultant counterparts. In short, this offers a new line of service, and thus a new source of revenue for existing information management providers: to turn themselves into experts in designing organizational memory.

Making It Work

Screenshot of Content Dashboard The best way to put this method to practice is one that is not onerously intrusive, does not consume vast amounts of time or resources, and leads to concrete results. If possible, it would also be great to make it scale well – not upwards, but downwards towards middle and smaller sized organizations. Here is why:

The fundamental promise of organizational memory design is that it improves an organization’s competitive position. This will lead to relative improvements in revenues and profits. But at first, working towards organizational memory design will necessitate spending valuable resources rather than saving them. Because both the first and the second step require the “is” and the “ought” of an organization to be captured, and there is no simple, “automagic” way to do that.

Of course, existing tools managing elements of organizational memory, such as content management systems and knowledge management systems, could be enhanced by building into them mechanisms that capture an organization’s memory practices and behaviors. For instance, systems that allow manual tagging of content in an organization could be employed to gather and compare tagging practices across the different parts of the organization. Similar data could be gathered about what content is kept, and what content is archived or even deleted and when. When such data gathering is built into the archival and retrieval tools already in use in an organization, some organizational memory behavior can be revealed without the need to interview all or at least an appropriate sample of the entire organization’s staff. This is precisely one of ForgetIT’s major goals, especially in the TYPO3 context. It is important, however, to be aware of the limitations inherent in such an approach, namely that this captures only one aspect of organizational memory behaviors, but leaves other aspects uncaptured. To be able to extend (and thus “ground-truce”) an organization’s memory practices comprehensively, more and other data gathering methods – such as interviews – may be necessary.

The second step requires eliciting organizational memory preferences from the organization’s management and leadership. To a very limited extent, such preferences can be captured passively as well through the method described for step one. The idea here is to only look at the memory practices of members of the management and leadership team of an organization, and contrast their behavior with the behavior of the rest of the organization, assuming that the leadership is already practicing what it preaches (and thus their practices reflect their preferences for the entire organization). This may offer a first glimpse onto management’s memory aims. However, because management staff may have different roles, because of the comparatively small sample, and because management, too, may be held back by the practices and be in need of “change”, this passive approach of capturing an organization’s self-defined “ought” has severe limitations, requiring supplementing it with interviews and other methods to gather relevant data about organizational memory goals and aspirations.

The third step – devising and operationalizing a strategy to get from the “is” to the “ought” - is even harder to automate, and in many contexts will require human intervention. Software tools alone will not be able to achieve this task, but human consultants well versed in information and memory management of organizations may be capable of accomplishing this. What is important, though, is that these human experts not only have domain knowledge on organizational memory, but also have truly internalized that the goal is to shape organizational memory in order to achieve competitive advantage. So they need to approach this not just from a technical and memory angle, but a business strategy angle as well.

Finally, a word on scale: Quite obviously, the larger an organization the more can be gained (in absolute terms) by optimizing that organization’s memory practices and processes. Yet, because so much is at stake, large organizations may already have undertaken steps to design their memory processes accordingly and thus may not be the only, or not even the prime target market for organizational memory design consultants.

In fact, medium-sized and smaller organizations – unlikely to undertake organizational memory design on their own, or even pro-actively think about it – may end up being a much more fertile target market. For them organizational memory design is like Rumsfeld’s “unknown unknown”: they don’t even know what they don’t know in terms of how they could improve their competitive positioning through a better design of their memory processes and practices. But for that, the entire design consulting process would likely have to be streamlined and made simpler, so that they could undertake it without a prohibitively high resource commitment.

Simple, not Simplistic - The Organizational Memory Cube

Illustration of the Organizaltional Memory Cube To cater to this target market, we have devised a method that enables organizations to locate their organizational memory practices, as well as their organizational memory aspirations along three distinct axes, forming what we termed the “Organizational Memory Cube”. The cube therefore is both a tool to locate an organizations current practices of handling memory and to make explicit its ultimate goals in doing so. By offering only three distinct dimensions, the complex phenomenon of organizational memory is greatly simplified, and made easily comprehensible.

It does come, however, with a significant cost. Thus, a word of caution is in order. Organizational memory is a complex, and multi-facetted process comprising numerous different dimensions. Reducing such a complex phenomenon that is highly specific to each organization to just three general dimension is a simplification that leaves much, and at times perhaps too much outside and uncaptured. At the same token, the cube is so simple that it can offer a diagnostic tool for organizations that would otherwise never consider deliberately shaping their memory practices and processes. As such, it may offer a first step, and if useful turn into a springboard for deeper and more comprehensive analysis.

The Organizational Memory Cube focuses entirely on the use of data as a resource of value to organizations. It does not differentiate between different data content or data types, and thus very obviously lacks depths. At the same token, it captures three very valid aspects of a data-driven strategic approach for organizations. This lends itself to the cube’s diagnostic and prescriptive use to enable organizations to become more data-driven through memory design.

The cube’s three dimensions are:

  • to what extent data is captured by an organization only with a specific purpose in mind or incidentally (so that whenever data can be captured it actually is captured, even with no concrete purpose in mind);

  • to what extent the organization has put (and is putting) in place structures and processes that enable data collection at high cost versus at low cost;

  • to what extent an organization sees data as an enabler or as the direct input to a product.

The more organizations are capturing data incidentally, having structures in place to do so at low cost, and see data as the resource that will lead to a product, the more data-driven they are. This is not a value judgment. Being more data-driven is not always better in itself, but given the rising tide of data and its use, it is an indication that an organization is closer to what can be termed the innovative edge.

In the cube context, the task of step one is thus to locate an organization’s current practices along the three dimensions, then asking an organization’s leadership to define their goals along the three dimensions: where would they like their organization to be in, say, three years? Finally, the organizational design consultancy would suggest strategies to close any delta between the “is” and the “ought” along these three dimensions.

Such an approach – a simple diagnostic, leading to sufficiently quick and straight-forward strategic prescriptions – could help more medium-sized and smaller organizations to embrace organizational memory design. It could also ensure that these organizations ask themselves questions that are key to a data-driven future. No organization would be required to become the next Google, but by asking questions about the role of data and data use, organizational management may recognize the competitive value of data, and realize the importance of data’s role (and – by extension – the role of organizational memory design).

It’s but a first phase of grasping the changing role of information in organizations in the future, and hopefully will lead to more thorough and comprehensive investigations and a more nuanced and rich overall strategy. It’s a conversation-starter, so to speak, and can lead to more and more organizations even of smaller sizes to take information and how they handle it seriously; that certainly would be progress. It also enables the establishment of a new consulting niche for those quick and smart enough to understand organizational memory’s potential by helping others to grasp it as well.

Authors

Foto of Professor Viktor Mayer-Schönberger Viktor Mayer-Schönberger is the Professor of Internet Governance and Regulation at Oxford. His research focuses on the role of information in a networked economy. Earlier he spent ten years on the faculty of Harvard’s Kennedy School of Government. He published seven books, as well as over a hundred articles (including in Science) and book chapters. His awards-winning book ‘Delete: The Virtue of Forgetting in the Digital Age’ has received favorable reviews by academic (Nature, Science, New Scientist) and mainstream media (New York Times, Guardian, Le Monde, BBC). Ideas proposed in the book have now become official policy, e.g. of the European Union.

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Photo of dkd CEO Olivier Dobberkau The Oxford Internet Institue (OII) is a department of the University of Oxford and is the world’s leading multidisciplinary academic centre focused on furthering understanding of the economic, political, institutional, scientific, legal and other social factors shaping the Internet and its implications for society. Its five research focal points examine the role of the Internet and other ICTs in: governance; learning and education; research networking; everyday life; and policy issues that cut across all these social settings, for instance standards and intellectual property rights. All OII research is characterised by: being methodologically open, innovative and critical, having a global reach, and acting independently of government or commercial influence.

Logo of Oxford Internet Institute Olivier Dobberkau is founder and CEO of dkd Internet Service GmbH in Frankfurt, Germany. He is President of the TYPO3 Association. He studied political sciences, law and computer science at Frankfurt University. Before he founded dkd he worked for American Express. He has over 14 years of experience in new media and internet. His expertise lies in the areas of project management, infrastructure and large organizations.

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Photo of dkd Developer Johannes Goslar Johannes Goslar studied computer science in Darmstadt and Sheffield after getting into IT with iOS game development. He is currently working at dkd Internet Service, where he was the technical lead for integration of ForgetIT technology for the project’s last year and regularly presented the progress at different TYPO3 conventions.

dkd Internet Service GmbH is an owner-managed full service internet agency located in Frankfurt, Germany. It is specialized in development, communications and design and lives and loves the ‘free software’ idea. Since its foundation in 1998 it evolved to a successful and sought-after TYPO3 agency. Expert knowledge is demonstrated in more than 600 projects for over 300 clients. Its multidisciplinary team consists of 63 developers, designers and marketing experts who offer everything which can make a good website a perfect one: starting with conception, followed by development up to operations.

Logo of dkd Internet Service GmbH The ForgetIT project is an European research project funded by the European Council within the 7th Framework Program. Its consortium consists of 11 members, each leading one workpackage. While preservation of digital content is now well established in memory institutions such as national libraries and archives, it is still in its infancy in most other organizations, and even more so for personal content. ForgetIT combines three new concepts to ease the adoption of preservation in the personal and organizational context: managed forgetting, contextualized remembering and synergetic preservation.

Cite:

@Techreport{dkdmem,
  author = {Viktor Mayer-Sch\"onberger and Olivier Dobberkau
    and Johannes Goslar},
  title = {Organizational Memory as Competitive Advantage},
  institution = {dkd Internet Service GmbH, Frankfurt},
  month = {January},
  year  = {2017},
  url = {http://blog.dkd.de/organizational-memory-as-a-competitive-advantage/}
}