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On Human Nature – Case of Irom Sharmila

Irom Sharmila has called off her hunger protest against AFSPA. She went through pain, misery and deprivation for 16 long years. There were hundreds of people who have been killed in the encounters with army. What was Sharmila’s demand? It was to repeal the AFSPA act or to modify some of its provisions. Continue reading


Importance of Tacit Knowledge for Organizational & Individual Growth – Part I

The two crucial challenges faced by today’s organizations in remaining competitive and thus  profitable are:

  1. Cut-throat Competition: I was talking to one of my clients who is in carbide tools, mould and die business. Twenty years back there were only 3 players. (two from Sweden and one from Israel) Today there are more than 20 players.(including  those from  Korea, Japan etc.) This has brought down the average margins by almost 50%
  2. Attracting and Retaining Talent: High competition leads to higher levels of attrition. It is assumed that a new executive starts contributing to the organization only after 7-8 months. Later he starts earning his salary and the real contribution starts only after 18-20 months. However in the present context, by the time the organization expects the employee contribution; the latter has already started looking out for greener pastures elsewhere.

Peter Drucker, the eminent management thinker predicted 40 years back that the future belongs to  knowledge workers and firms can have a competitive advantage only through effective knowledge management. There are three ways how firms can  remain  competitive:

  1. Generate new knowledge continuously.
  2. Disseminate the new knowledge across the organization in a systematic manner.
  3. Apply the new knowledge to develop new technologies , products and services.

There are two types of knowledge:

  1. Explicit Knowledge: Is the one which is available through systems, processes, technology, patents etc. This knowledge to a greater extent can be shared. Through technology transfer it can be acquired.
  2. Tacit Knowledge: This type of knowledge is with the individual and does not reside in SOPs. It is also context-specific. This is acquired through experience. The term was coined by Michael Polanyl in 1958 who said, “we can know more than we can tell.” It can be defined as skills, ideas and experiences possessed by an individual. Quite often they are not codified, written or verbalized and hence difficult to transfer from one person to the other. Examples of tacit knowledge are playing a musical instrument, preparing a signature dish, driving car etc.

Three decades back I was working with a renowned electrical consultant called P.H. Padhye in Mumbai  who was having a consultancy assignment  ( paralleling of existing Petbow and Skoda DG sets with the MSEB supply) with Ceat Tyres.  Once the plant had tripped off and the entire production had come to a grinding halt. The maintenance head and others were struggling to solve the problem but could not succeed even after 24 hours. When we went to the plant,  Mr. Padhye told the maintenance head, “ the setting of the speed governor of your alternators are wrong and that is why the tripping has occurred.” The problem was sorted out in half an hour. This is tacit knowledge.  Mr. Padhye was a very knowledgeable person. Once after a marathon session on electrical circuit design, I asked him,” how do you know so many things?” He replied, “after 32 years of experience in the industry, I know what I don’t know.”

Many of you must have heard the apocryphal story where the boiler of a steam turbine had malfunctioned. An expert mechanic  was called . He asked for a hammer hit it at the right spot and lo behold… the boiler started working.. When the mechanic submitted the bill of Rs. 10,000 /- The finance manager was quite perplexed. When asked for the breakup of the  bill for a task which did not take more than 5 minutes,  the mechanic replied as follows:

  1. 100/- for hitting the hammer
  2. 9900/- for knowing where to hit and thus solving the problem.

You will observe that the former is explicit knowledge whereas the latter is  tacit knowledge.

You will appreciate the importance of tacit knowledge through this example. recognising the face of a person in  a crowd is tacit knowledge;  whereas to  recollect the other details is explicit knowledge.  Only though experience this tacit knowledge is acquired. Every evening when the employees leave the office such tacit knowledge is leaving the organization and when a talented and experienced employee leaves the organization; such tacit knowledge is lost forever.

At a number of places I see that there are no jobs available for executives who are 45+.  This shows our irrational bias towards explicit knowledge (read technology) which youngsters seem to possess. But we fail to realize that  a fast-changing technology can even make a young executive redundant equally fast. What  is important is not so much as knowing a  specific technology but the ability to learn new things and the organization having such workforce (who are willing to learn continuously)  is called as a learning organization. A number of organizations feel cost to be  the only driver to retain a competitive advantage and replace older executives.

E.F. Schumacher in his book, Small is Beautiful has something relevant on this topic. Quote:

Education can help us only if it produced ‘whole man’. A truly educated man is not the one who knows a bit of everything, not a man who knows all the details of all the subjects (if such a thing is well possible). The whole man in fact may have little detailed knowledge of facts and theories (read explicit knowledge). He may treasure the Encyclopaedia Britannica because SHE KNOWS and HE NEED NOT, but he will be truly in touch with the centre.

He will not be in doubt about his  basic convictions, about his views on the meaning and purpose of his life. He may not be able to explain these matters in words; but the conduct of his life will show a certain sureness of touch which stems from his inner clarity. (read tacit knowledge)

Unquote (italics mine)

What are the different ways the tacit knowledge can be effectively harnessed shall be looked into my next blog…

Rajan Parulekar| rajan@paradigm-info.com|www.paradigm-info.com


Azim Premji – Integrity Personified

Shri Azim Premji has completed 50 years in business and I would like to share an important facet of his personality. The one thing he never compromised was integrity. Wipro Fluid Power (now Wipro Infrastructure Engineering )  was  set up in Peenya Bangalore in 1992 for the manufacturing of hydraulic cylinders Continue reading


What makes it difficult for us to spot talent?

It is heartening to know that the Magsaysay award winners from India this year are Bezwadi Wilson & T.M. Krishna for their yeoman service in manual scavenging in KGF and propagating Carnatic music in slums of Chennai.

The flip side of this is Wilson and Krishna were never recognized by the Indian establishment till date. Continue reading

Three Bad Habits Sabotaging Your Productivity

Clock-StressPeter Drucker was  consulting for a CEO of a major bank in US.  For every meeting the  CEO used to assign Peter a time slot of 90 minutes. A highly effective person, the CEO was delivering  consistent results for his bank year-on-year. During the  one-and-half hour meeting the CEO refrained from taking any telephone calls Continue reading

How NOT to recruit a candidate

Natasha,  a sales manager from a renowned  hotel in Goa interviewed a candidate called Moin,  a B.Com graduate for the post of a trainee sales executive. Moin was a tall, fair and handsome guy who  spoke fluently during the interview. Natasha felt he was an ideal candidate for sales. When asked about his strength, Moin  replied his strength was manipulation. Save for this ‘minor’ aberration he looked OK on other fronts.

He was shortlisted  for the next interview, where he repeated the same answer when asked by the GM. The considerate GM said, “young man, please go home and refer the dictionary and check the meaning of the word manipulation. You should not give such answers. Elsewhere you would have been rejected straight away.”

After joining, Moin started throwing tantrums . When asked to usher a guest in the restaurant, he said, “I am graduate, I do not do such things.”  Natasha once asked him to follow up for payment from one of the regular guests of the hotel.  Moin fired the guest saying that if the latter does not pay immediately, he may have to face dire consequences. Luckily Natasha, the manager overheard the telephonic talk, seized the receiver and apologized to the guest. Within two months, Moin resigned without giving any reasons.

The manager had spent her precious time of hers as well as of others including the GM. It is very rare for someone to contribute significantly during the first six months. Precious time and money of the organization were wasted.  Some of the mistakes managers  make while recruiting are:

  1. Selection Bias for common traits: The candidate revealed his interest in being a DJ which was a common interest for the manager too.
  2. Emphasis on external appearance: Selection of candidates is based on appearance, personality as well the hearing the expected responses. For example when asked why would you like to join our company, the typical response from candidates is: “I would like to take challenges and grow with a growing organization.”
  3. Ignoring the Obvious: Listen to what the candidate says and also what he does not want to tell. Here Moin went on harping his manipulation skills which was ignored.
  4. Mistaken Competencies of a Job Role: Most of us feel that a good talker is a good salesman. It may be true for low-value sales. However for high-value product or service like premium hospitality,  the converse is true. It is not the glib talker but the effective listener who fits the bill for a good salesperson.

For more details please refer the chapter,  Why do Salesmen Love to Talk in my book Contextual Selling (for more details http://www.paradigm-info.com)

Cognitive Biases that affect Decision Making

“I tried to get an appointment with my client for six months, I could not succeed”, said Shashi, my friend in an Omani Company. “However the moment my Scottish counterpart sitting in the next cabin called him, he got an appointment the next day”.

Two Caucasian ladies, one French and the other a Polish, sang an average composition on peace & harmony in Bangalore for 2-3 minutes. After their recital, there were hordes of people from the audience who wanted to get photographs along with them. The singers were neither celebrities nor accomplished singers, but the colour of their skin made all the difference! Let us look at the different types of perceptual biases most of us have.

  1. Blind-Spot bias-: Your own cognitive bias is a bias in itself. People notice cognitive and motivational biases much more in others than in themselves. We have a positive bias towards the Caucasians but may discount brown or dark-coloured skin executives.
  1. Anchoring bias: People are over-reliant on the first piece of information they hear. In a salary negotiation, whoever makes the first offer establishes a range of reasonable possibilities in each person’s mind
  1. Availability heuristic: People overestimate the importance of available information. A person might argue that smoking is now unhealthy because they know someone who chain smoked and still lived upto 100. Quite often the information is taken out of context or only a sample is selected by ignoring the other data.
  1. Bandwagon effect: The probability of one person adopting a belief increases based on the number of people who hold that belief. This is a powerful form of group-think and is reason why meetings are often unproductive.
  1. Choice-supportive bias: When you choose something, you tend to feel positive about it, even if that choice has flaws. Like how you think your dog is awesome – even if it bites people every once in a while.
  1. Clustering illusion: This is the tendency to see patterns in random events. It is key to various gambling fallacies. Like the idea that red is more or less likely to turn up of a roulette table after a string of reds.
  1. Confirmation bias: We tend to listen only to information that confirms our preconceptions – one of the many reasons it’s so hard to have an intelligent conversation about climate change.
  1. Conservation bias: Where people favour prior evidence over new evidence or information that has emerged. People were slow to accept that the earth was round because they maintained their earlier understanding that the planet was flat
  1. Information bias: The tendency to seek information when it does not affect action. More information is not always better. With less information, people can often make more accurate predictions.
  1. Ostrich effect: The decision to ignore dangerous or negative information by “burying” one’s head in the sand, like an ostrich. Research suggests that investors check the value of their holdings significantly less often during bad markets

It is not possible to eliminate all the biases, but the least we can do is to be aware of them and in mindfulness the chances of our decisions going wrong can be minimized.