The left Flying Wheel of the L'Earning Lemniscate is all about capabilities. A capability is something an organisation does very well and/or is "unique" (We build upon the definition of Hamel and Prahalad – 1990). The competitive advantage of an organisation depends on it. In fact it is even more important than products and services (that's why those are not visualised in the L'Earning Lemniscate). If well funded, staffed and managed, it becomes a flywheel which develops collective and individual capabilities.
The ambition of an organisation drives the flying wheel. A crisp strategy with a clear an communicated vision and ambition is – together with the urgency – the fuel for the flying wheel. It builds upon the external view (market opportunities and customer needs) as well as the internal view (identified latent of manifest capabilities).
A Collective Capabiltiy is a distinctive profitable competence at organisational-level, which are characterized by explicit (documented, shared and distributed ) knowledge, methods, techniques, tools, sufficient trained staff to ensure quality, time to market and continuity and -last but not least – customer references. You can recognise a collective capability by the customer telling: "Company X is great in …."
Knowledge shapes the firm’s core capabilities (Prahalad &Hamel 1990) and therefore determines value creation (Grant, 1996).
Individual Capabilities are about Skills, Attitude and Knowledge of individual professionals, which build up a collective competence. The ability and attitude for knowledge sharing and working (collaboration, co-creation) in social networks are an inseparable part of the individual competence as we see it. You can recognise a individal capability by the customer telling: "James is great in …."
Note the difference: this approach differs from older models (SWOT, Porter's five forces modelling) in which de external environment is the major driver in defining the strategy. The L'Earning Lemniscate put it's weight on the strength of an organisation: the capablities, which enables productinnovation. Be aware: it doesn't deny the external view. The organisation ambition must be aligned with the market in a realistic and prfitable way.
Plan-Do-Check-Adjust Cycle (PDCA)
Driven by the organisation ambition an organisation developes in a planned way Collective Capabilities by using Individual Capabilties. The PDCA cycle embodies that it has to be planned, executed and checked. Adjustment takes care of a development which used learning point. By doing so ii is flexible in order to be become (next to a lot of other things) a true Learning Organisation.
The PDCA Cycle starts with a good strategy and posesses at least the following components:
- An articulated organisation ambition.
- Inventory of Individual and Collective Capabilities (including owners) and their appraisal (knowing what you know) and weak spots.
- Leverage points: identifation an approach.
- Road Map (including planning of benefit realisation and Quick Wins).
Essential in this process is -besides the planned development of Capabilities – to embed the learning "before, during and after" in organisational processes in a sustainable way (continuous improvement). The abilty of listening to people (and not politics) and connecting them is crucial.
Last but not least it is crucial to define the right approach: the so called Knowledge Flow Strategy:
The codification strategy puts organizational knowledge into a form that makes it accessible to those who need it. It literally turns knowledge into a code (though not necessarily a computer code) to make it as organized, explicit, portable, and easy to understand as possible.
The personalization strategy focuses on developingnetworks for linking people so that tacit knowledge canbe shared. It involves linking people who need to know with those who do know, and so developing newcapabilities for nurturing knowledge and actingknowledgeably. It invests moderately in IT.
The best practice is that you take 80% of one and 20% of the other kind.
Impact on other parts
The Capability Flying Wheel has an impact upon all other parts of the L'Earning Lemniscate. Examples:
- The individual contribution of a professional is larger when the left flying wheel has a strong organisational ambition and a energic PDCA cycle.
- The individual contribution of a professional is larger when he/she is stimulated in his/her professional development (individual capability).
- The individual contribution of a professional is smaller in the case there is insufficient ownership of collective capabilities, a bas performing PDCA cycle and a lack of resources. It might be that enthousiastic (group of) individuals builds upon collective capabilities, but without the organisation ambition, the ownership of colective capabilities and a well working PDCA cycle it ends up in frustration.
Performance of the Capability Flying Wheel
The degree to which a company is able to identify, develop and divest the needed collective and individual capabilities in order to fulfill the organisation ambition determines the performance of the L'Earning Lemniscate left Flying Wheel. It also determines the customer satisfaction (in case that's the organisation ambition) and the success of the company!
Essential is to seek the hotspots with the high value, use what exist, untapping the knowledge from individuals, focusing on the need to know knowledge capture and cross-pollination. Capture ans cash the benefits – tied to business metrics – as you go.
Screening of the performance of (among others) the left Flying Wheel is subject of an maturity check and an audit. Do get in contact if you (want to) know more about L'Earning Lemniscate Screening.