CAN ORGANISATIONS LEARN

WHILE SUFFERING CORPORATE MEMORY LOSS ?1

by

Colin A. Sharp

Copyright (c) 1996 All rights reserved. © This is a draft work in progress paper open for comment. No part of this work may be reproduced without the permission of the author. Please direct all correspondence to: Dr Colin Sharp PO Box 378, Stirling, SA, Australia, 5152

1 This paper is based on earlier papers by Sharp & Lewis delivered at the Information Systems as

Organizational Processes Conference at the University of Wollongong, October, 1992, and the ANZAM Conference, Deakin University, December 1993. It is part of an ongoing study of organisations made possible by University Research Board grants to Sharp & Lewis, from Flinders University, which has included a Masters project by Apsey (1994).

Corporate Memory 2

ABSTRACT The strategy of "down-sizing" organisations in turbulent economic circumstances has implications for the organisational strategic capacity to learn. These changes in the strategic direction and structure of organisations bring increased pressure on organisation culture, and may inhibit the capacity of the organisation and/or the commitment of the staff to the ideals of the Learning Organisation culture. Particularly relevant are the more intangible human memory or "soft" aspects of the corporate information systems. The term "total corporate memory" is used to describe the formal and informal collective and individual data and knowledge held by employees gained through their experience and positions within an organisation. Issues involved with "corporate soft data", "human capital" and the relationships with organisational learning are elaborated. Suggestions are made as to the role of the strategic human resources planning of organisations as well as for directions in further research. The paper reports two approaches currently being developed to research in this new field. The first is a naturalistic inquiry to scope the issues through convenience case studies. The second approach is an attempt to systematically gather and map the concepts underlying corporate memory in organisations by structured questionnaires. The questionnaires being developed are based on the Q-sort and Rep Grid methods to map relevant concepts held by the staff of particular organisations going into down-sizing. In the naturalistic inquiry, two government agencies are examined as case studies. Preliminary evidence from a participant observer suggested that in one organisation some preparation for hand-over and retention of relevant soft and hard aspects of corporate memory, was made on an individual basis as well as among the corporate executive. The interview data from the other organisation apparently indicates that they did not take such steps in any formal or informal manner. These cases were investigated as part of a comparative analysis of factors which may or may not contribute to perceived corporate memory loss and its prevention. Although the research methodologies are still being established, it is argued that there is little else available in this field. It is emerging as a common belief in the literature that appropriate human resource management strategies which recognise the importance of "tacit knowledge" and "total corporate memory" within organisational strategies, can lead to planned transfer or discarding of elements of corporate memory. Such an approach to management of corporate memory is expected to have benefits within a more appropriate overall human resource management strategy to cope with turbulent organisational change. Indeed, it could be argued that organizational learning is the exercise of corporate memory. In any case, from first principles and available theory, it is thought essential for organisations to plan and manage their capacity for retention of organizational learning.

Corporate Memory 3

CAN ORGANISATIONS LEARN WHILE SUFFERING

CORPORATE MEMORY LOSS ?

"... the turn-over of relationships with formal organizational structures brings with it an increased turn-over of informal organization and a faster through-put of people as well. Each change brings with it a need for new learning. He must learn the rules of the game. But the rules keep changing." (Tofler, 1970, p. 143)

INTRODUCTION Staff turn-over, cost-cutting and "down-sizing" of organizations are commonplace in the public sector and private sector bureaucracies in economic down-turns (Australian Bureau of Statistics, 1994; Bramble & Littler, 1994; Cascio,1992, 1993, 1994; Dunford, 1994; Littler, Bramble & Mc Donald, 1994). They have also become fashionable with the "Re-engineering" approach (Grint, 1994; Hammer & Champy, 1993). Increasingly, the consequences of continual organizational change are becoming a matter for concern of organisational researchers (Inkson, 1993). This trend has produced research on "survivor sickness" (Marks & Mirvis, 1992), i.e., the stressful effects on employees of the uncertainty of change, as well as the anxiety of unemployment for those retrenched (e.g., Cartwright & Cooper, 1990, 1993) and the focus of management researchers concerned with the associated problems of productivity and organization effectiveness (Cartwright & Cooper, 1990; Dunford, 1994; Hunt, 1988). These are important tangible domains of the effects of organisation transformation, however, there is a need for research on the less tangible strategic human resource management aspects of management information systems. Focus on Transformation of the Public Sector Organisations in the public sector have undergone major organisational change in Australia (Buchanan, Campbell, Callus & Rimmer, 1992; Cornford, 1994; Dunford, 1994; Dunphy & Stace, 1990; Morris, & Coultan,1994), as well as in Europe and the U.S.A (Cameron, Freeman & Mirshra, 1993; Leeuw, et al. 1994; Pollitt, 1995). At the same time, as pointed out elsewhere (Sedgewick, 1994; Sharp, 1996b), there has been an emerging interest in public sector organisations from authors concerned with organizational learning (Leeuw, Rist, & Sonnichsen, 1994) and its relationship with organizational culture (Hampden-Turner, 1990; Osborne & Gaebler, 1992; Sinclair, 1989; 1991). For example, in Australia the Commonwealth Government introduced in 1984- 1985 steps to implement its management improvement objectives through a concerted, whole of government approach to evaluation training and practice. Later a Task Force on Management Improvement of the Management Advisory Board and the Management Improvement Advisory Committee of the Commonwealth was established and found significant progress in these initiatives (MAB-MIAC, 1993). More recently the change of Government, with the 1996 win of the conservative party of Australia, has introduced another 'down-sizing' of the Commonwealth public sector, to rival the major transformations of some state Governments in the last few years (Morris, & Coultan,1994; Office of Commissioner for Public Employment, 1994). This leaves in doubt the continuity of methods and the commitment to the culture of organizational learning (see Sharp, 1996b). It reinforces concerns about whether the establishment of key management tools, including methods like program evaluation and benchmarking, can be sustained in the climate of down-sizing (Sharp, 1995). The Australian Situation: Down-sizing

Corporate Memory 4

One of the more important studies recently available, by Littler, Bramble and McDonald (1994) has provided a thorough review of the types and effects of down-sizing, delayering and “lean production” models, concluded there was little systematic research on which to generalise about these approaches in the Australian context. Although some case studies are emerging on strategic human resources management (Patrickson, Bamber, & Bamber,1995) and management information systems policies (Pliskin & Romm, 1992), this is a serious deficiency, for academics and practitioners interested in the development of learning organisations. The difficulty in obtaining access to the qualitative, personal, confidential data, and other pertinent information, is a severe stumbling block to research in this field. Recently, the extent to which "delayering" is followed by "relayering" (Littler, Bramble and McDonald, 1994, p.23) is the subject of exploration, as is the extent to which such reductions have in their genesis more to do with a broad political commitment to the principle of downsizing than actual organisational needs based on best practice and economic competitiveness. In other words, has a blunt tool been used to provide the appearance of significant changes which in reality cloaks the absence of substantive alterations to practice and skill acquisition. Based on a study of thirty US firms in 1993, Cameron et al (1993) concludes that three types of downsizing strategy can be discerned at work. These were work force reductions which focus on short term results and redundancies, organisational redesign (elimination of layers) and systemic approaches. Consistent with the view of Cascio (1992), Cameron et al (1993) found that work force reduction was the principal focus, and that those who made most use of attrition, increasing work of employees, and not focussing on the improvement if quality outcomes tended to have the highest incidence of negative results. Unfortunately, there are, to date, very few Australian case studies. The occurrence of downsizing as defined by Cascio (1992) as the planned reduction of jobs is uncontrovertible in broad terms as a world wide phenomenon. A survey of companies in Canada, Britain, and Germany in 1993 reported restructuring, downsizing or cost reduction in 90 - 98% of cases since 1988. For the United States the figure was 855 and Japan 69% (Cascio, 1994, p.8). In the United States between 1987 and 1991 the reduction in jobs was in the order of 5.6 millions, with the greatest impact on larger corporations. A significant feature has been that the middle management area constitutes 17% of all dismissal but represents only 5-8% of the workforce (Cascio, 1993, p.96). This trend in job reduction has been mirrored in Australia . Since 1989, two million Australians have been retrenched. Data released by the Australian Bureau of Statistics indicates that the numbers retrenched on an annual basis have progressively increased since 1982 from 315.300 to 450000 in 1994 (Australian Bureau of Statistics, 1994). It is suggested that Australian companies have reduced labour two and one half times faster than the top 500 American companies which took ten years to achieve the same cuts (Cornford, 1994). Some attempts to explain these trends are emerging. For example, Hamel and Prahalad (1994) support the view that a preoccupation with cost cutting at the expense of the development of new and strategic approaches to management (referred to as "stretching" the thinking of an organisation to develop a position to best fit into the market place on a competitive base) is destructive. The authors argue that obsessive attention to the denominator line of cost structures and head counts stunts the overriding objective of enhancing the numerator line of new ideas and profits. Buchanan (1992) concludes on the basis of seven case studies in 1992 that the way redundancies are handled is influenced by the scale of the workforce reduction.

Corporate Memory 5

A corollary contention is that managers have moved sideways and downwards with an increasing emphasis on reactive (organisation initiated) reasons (Inkson, 1993). A recent Australian survey based on data drawn from 4000 executives who took part in outplacement programs revealed that the average age of unemployed managers plummeted from 48.5 years in 1989 - 90 to 41.75 years just two years later. This sudden drop in age is attributed to the culling of the "babyboomers", and the data also demonstrates a massive increase in outplaced staff changing industries to obtain new employment. The number of people who changed functions to find a new job rose 7% in 1991-2 to 43% in 1993-4 (Davidson and Axsmith, cited in Tabakoff, 1994). Littler et al (1994, p.35) contend that the overlapping literature in relation to delayering is inconclusive in regard to the extent to which the phenomenon has actually occurred, and the extent of its impact on the empowerment and skilling of staff is unclear. They contend the terms "delayering", "downsizing" and "restructuring" as recently articulated, are in need of clear theoretical frameworks to permit the analysis demanded of them. However, their attempt to provide such a framework is still in its early stages, and is in need of further research to assist in elaborating some of the issues raised. Implications of De-layering for Corporate Memory? Few studies (see Dunford, 1994) have dealt with the implication of the delayering of middle-order managers for organisational memory as a strategic human resources management issue. It is possible to speculate what those effects may be, or to identify some signs of the delayering influencing corporate effectiveness (Dunford, 1994). However, there is insufficient evidence to on which to base reliable or valid strategic human resources management advice on these matters. A review of the literature on "tacit knowledge" (Nonaka, 1991) and "organisational memory" (Huber, 1990; 1991; Sharp & Lewis, 1993; Ungson & Walsh, 1991) reveals that these concepts are lacking in systematic research. The two main reasons for this paucity of research are that the field and its concepts are still ill-defined and the methods for conducting such research are still undeveloped. In an effort to develop suitable research methods for operationalising and testing corporate memory loss, there are some pre-conditions and some parallels which are important to address, viz: • Pre-conditions

* definition of corporate memory (this is addressed in other papers, see Sharp & Lewis, 1993)

* developing tools for modelling corporate memory data or knowledge (Latta & Swigger, 1992)

* raising awareness of the content, and storage of corporate memory (see Apsey, 1994) * estimation of extent and awareness of corporate memory loss (see Apsey, 1994; Lewis,

Sharp & Apsey, 1995)

• Parallels * personal construct theory and the development of methods of investigation of personal

constructs, e.g. REP grid (Kelly, 1955; Latta & Swigger, 1992; Shaw, 1980) * inter-personal communication assessment tools for the supervisor -supervisee relationship

(Barrett, 1995) * development of group learning (Dixon, 1994; Galagan, 1993; Kim, 1993).

Corporate Memory 6

At this stage of development of corporate memory research and knowledge it is not feasible to meet all these pre-conditions. But by examining the parallels from other fields it may be possible to begin to address the pre-conditions. We will elaborate on a few of these parallels in the following sections. Other research (see Lewis, Sharp & Apsey, 1995) has examined the extent of the storage of corporate and personal data in soft form, which is a partial indicator of the potential risk of corporate memory loss. This paper documents attempts estimate the degree of awareness of the risk and the motivation to identify the risk of corporate memory loss. This is primarily studied by comparison of supervisor's and subordinate's perception of the importance of types of information, and whether this information is known or unknown to either person, and whether they think it has been gained or lost in a recent change of staffing. DEFINTIONS AND SCOPE Definitions of Key Terms It has been known for some time that the position a staff member holds in an organisation has access to certain data which others may not be aware of, and entails cognitive responsibilities and consequences individually and organisationally (Zajonc & Wolfe, 1966; Whyte, 1956). Regarding the storage and retrieval of that data or associated information the term "total corporate memory" has been used by Sharp an Lewis (1992; 1993), to identify the organisation's interests in, and ownership of, a substantial part of the relatively informal collective and individual data and associated knowledge held by employees gained through their experience and position in the organization. Especially relevant are the "soft" aspects of the corporate information and "tacit knowledege" (Nonaka, 1991) of key individuals which organizations need. Unfortunately, such data is difficult to identify and has not been subject to much research. (see Sharp & Lewis, 1992; 1993). Research is currently investigating the issues concerned with how the "corporate soft data" is stored in organisations in the public sector, and how this is affected by staff turn-over, or down-sizing the organisation. The reference to "total corporate memory" (Sharp & Lewis, 1993; Sharp, 1995; Lewis & Sharp, 1994) was an attempt to define the various components of organisationally sensitive data which could be the basis for information collection, storage and retrieval, and to examine the implications of the cut-backs in staffing on the potential for retention of that data. In this endeavour we focus on some of the lessons identifiable in the experience of public sector organizations in Australia. Sharp and Lewis (1993; Lewis & Sharp, 1995) defined "corporate memory" as being a function of data (both hard and soft) of the corporation as well as the employees of that corporation, which can be expressed as follows: Total Corporate Memory is defined as: CM = f (Ch, Cs, Ph, Ps), where: CM = corporate memory, which is thought to be a function of: Ch = Corporate hard system data, both hard copy, such as inter-office memos and manuals

as well as transactional data (e.g., in paper form of invoices, receipts and accounts) and electronically encoded textual data, stored centrally as well as distributed through the various network and system hardware;

Corporate Memory 7

Cs = Corporate soft system data pertaining to the organization, which include: * knowledge surrounding the hard data;

* "organizational culture" (collective, or shared beliefs and values about the organization by the individuals comprising the organization);

Ph = personal hard copy data, i.e., individual personal records of the personnel (gained by

virtue of their position or idiosyncratically) stored in hard copy, usually printed or written on paper (e.g., notes in their diaries);

Ps = personal soft data, i.e., the implicit meaning and individuals' personal views or

recollections stored in their own mind's memory, whihch may not be specifically “corporate” but add value to interpreting the context of corporate data, or give it information value in certain contexts.

The distinctions between the corporate and personal aspects of organisational memory were used to expose the under-estimation of the information available which has potential value for the organization. Other authors have referred to similar aspects of organisational memory such as "tacit knowledege" (Nonaka, 1991); or the holistic meaning of the contextual aspects of the system by the term "Weltanschauung", literally world view (Checkland, 1981). However, it has not been common to clarify the sense of corporate memory per se, nor its components. There are several authors (e.g., Mintzberg, 1989; Senge, 1990; Walsh & Ungson, 1991) who suggest that managers build their own personal databases which are maintained and controlled by them in both hard (Ph) and soft (Ps) form to enhance organizational data which is stored in hard (Ch) form in the computer and in soft form in the organisational culture (Cs) and networks (Cs). It is this form of "added value" of information and expertise of experienced staff which their on-the-job training began to develop; but which the current cut-back staffing policies tend to ignore as if this information is perceived as of no value. It is naive to expect that available information systems can accommodate the necessary information, if the access to it has already gone through key staff taking redundancy packages and taking their unknown knowledge and expertise with them. Scope of Present Research Although there is a general need for research into organisational memory, the present research has concentrated on identifying aspects of corporate memory and developing suitable methods to investigate these concepts. The circumstances sustaining this research have been the exigencies of the down-sizing of the public sector in Australia. Part of the motivation is to develop tools for managers to prevent the potential corporate memory loss possible with the staff-turn-over and down-sizing.

Corporate Memory 8

CORPORATE MEMORY AND STRATEGIC HUMAN RESOURCES MANAGEMENT Strategic human resources management is an emerging field (Littler, Bramble & McDonald, 1994; Storey, 1992). There are few relevant systematic studies concerning the strategic impact of organisational change on human resource management in the public sector (Patrickson, Bamber, & Bamber, 1995). The present paper will follow up on strategic issues raised regarding the intersection between human resource management and management information systems (Sharp & Lewis, 1993). In particular, strategic issues such as the difficulties of organisational learning and organisational memory are consequential to the recently escalating strategy of organisational down-sizing. Sharp and Lewis (1993; Lewis, Sharp, & Apsey, 1995) identified that there were at least four potential system design limitations which take on significance in the down-sizing and restructuring of organizations, viz.: * neglect of the attrition of `personnel memory' (Ph and Ps data) resulting from the

dislocation of staff; * neglect of the effects of this loss on total corporate memory and on the evaluation and

change processes; * a focus on managers' needs in the organizational diagnosis and management information

systems design at the expense of the needs of the workers at the client or market interface; and * a lag between when the system designers conduct their organizational diagnosis and obtain

the organizational information needs, to when the design is fully implemented and the errors become noticeable (see Checkland, 1981 Senge, 1990).

The latter point is important because of the realisation that there are occasions when we do not have enough awareness of what needs to be kept or developed until it is gone or deteriorated. The degree of lag can be exacerbated by prevailing conditions of (internal and external) environmental uncertainty (and organizational cultural factors), which are the circumstances that require the most appropriate strategic response of the organization and its managers, and when they are most likely to need an up-to-date MIS and evaluation/monitoring process. If this lag is exacerbated by internal confusion and staff turn-over, there is a risk that the original goals of the MIS may mis-match the needs of the staff replacing them, as the new comers may not have access to the same degree of inside knowledge or corporate memory. The Aspects of Organisational Memory Not Known to the Organization In order to be able to research corporate memory loss it is important to clarify what aspects of corporate data and knowledge exists, and what is known to the organisation and its staff. Here it is useful to adapt the JOHARI Window framework (see Luft 1971) to recognise some of these aspects of corporate memory. The JOHARI Window was intended in a training context for raising awareness of information in a novel inter-personal or group communication situation (see Luft & Ingham, 1955; Luft, 1961a, 1961b and 1971). The basic point of the associated self-awareness raising exercise is to acknowledge that there are areas of one's inter-personal skills and self-knowledge which are under-developed or unknown, to oneself and/or to others. The classic two-dimensional figure

Corporate Memory 9

(Figure 1 below) is used to identify the domains of possible inter-personal knowledge in a group situation.

Figure 1: JOHARI Window (adapted from Luft, 1971)

Known to Self NOT Known to Self Known to Others 1]

PUBLIC

2] BLIND SPOT

NOT Known to Others 3] CLOSED

4] UNKNOWN

The obvious change is the labelling of the dimensions in terms of corporate memory from the staff member and organisational perspectives.

Figure 2: Corporate Memory Window (adapted from Luft, 1971)

Known to Staff Member NOT Known to Staff

Member Known to Organisation 1]

Corporate Knowledge: soft & hard data

2] Priveledge knowledge

soft & hard data

NOT Known to Organisation

3] Private knowledge soft & hard data

4] UNKNOWN or lost

soft data ("tacit knowledge"?)

This analysis recognises that some aspects of the corporate memory are privileged and not shared with all staff. This is likely to include both soft and hard data. Those aspects of corporate memory most likely to be subject to loss with staff turn over are:

• 'private' (or exclusive) hard or soft data or knowledge held by staff which are relevant to the organisation's operations; this could include personal notes of transactions, dialogues or meetings with clients exclusively by a staff member and not shared with other colleagues; and

• the 'unknown' area which is data available to members of the organisation, but about which individual or group attention has not been gained or awareness has not been raised; this is most likely to be hard data which has not been attended to, because soft data at least has to be in someone's head, and so someone should have attended to the data at some stage.

Corporate Memory 10

THE PRESENT STUDY Can Corporate Memory loss be avoided? Sharp and Lewis (1993, Lewis, Sharp, & Apsey, 1995) identify some steps in the strategic nexus between evaluation and program design, management information systems and strategic management, which may rectify some of these problems. As yet there is little evidence about whether this approach will prevent corporate memory loss. The interim results of two case studies, which are currently under investigation, are reported. One study (labelled Case A) is the investigation of the type and extent of the effects of loss of experienced managers in one South Australian Government Department which (whether deliberately or by good fortune) had taken some steps to hand over valuable information before the senior staff left. The other (labelled Case B) concerns a Commonwealth department which closed aspects of its regional operations without such precautions in information retention. Research Plan The findings of the review of the literature and earlier studies (Lewis, Sharp & Apsey, 1995; Sharp & Lewis, 1993) suggest implications for design and implementation of preventative approaches. In some ways the public sector provides an opportunity to examine the implications of these potential problems for the interaction of information systems and human resource management. Here follows the report of two approaches currently being researched. The first is a naturalistic inquiry to the scoping the issues through convenience case studies (Lewis, Sharp & Apsey, 1995; Sharp & Lewis, 1993). The second very recent approach is an attempt to systematically gather and map the concepts underlying corporate memory in organisations by structured questionnaires. The questionnaires being developed are based on the Q-sort and Rep Grid methods to map relevant concepts in the staff of particular organisations. In the naturalistic inquiry, two government agencies were examined as case studies. Preliminary evidence from a participant observer (Apsey, 1994) suggested that in one organisation some preparation for hand-over and retention of relevant soft and hard aspects of corporate memory, was made on an individual basis as well as among the corporate executive. The interview data from the other organisation apparently indicates that they did not take such steps in any formal or informal manner (Lewis, Sharp & Apsey, 1995). The basic methodology is comparative case study, involving modelling existing data in public sector organisations, so as to then simulate and test the hypotheses regarding loss of corporate hard and soft data. The intention of this study is to examine the implications for information and skill loss which may be attributed to the departure of senior staff from government agencies. Attempts to identify and overcome problems of Organisational Memory The rapid development of information technology and the importance of integrating those techniques with organisation design, planning and training has been the subject of increasing interest in the literature relating to "the learning organisation" (Senge,1993; Kim,1993). However, whilst the restructuring and downsizing processes have gained momentum during recent years within the public sector, there has been relatively little work undertaken in relation to the implications of the loss of senior and experienced executives for the capacity of public sector organisations to face new challenges. Nor has great attention been given to the way such

Corporate Memory 11

organisations can develop approaches to the best ways of planning for such separations, or appropriately capturing information and expertise. CASE STUDIES: METHOD OF INQUIRY The present cases are part of a program of research which has been dependent on a convenience sample of organisations willing to be subject to corporate memory research. All available organisations have undertaken, or been subjected to, significant transformation and so the relevant staff are often too busy to, or too nervous to, participate in lengthy questionnaires, or interviews. The form of the study is partly dependent on the access to the interviewees and the corporate culture. It is important to be able to interview samples of those who have left the organisation as well as they who have stayed after the change or transformation. But this is often a matter of circumstance and/or persistence. Table 1 summarises the state of ongoing data collection to date. It was intended to interview at least two managers who have left and two whom have stayed in each of the two organisations.

Table 1: Case Study Methodology Case/Organisation Data Collected Data To Come

A 2 Executives who stayed Vs 2 Executives who left

2 or more Senior Officers who were subordinates of those who stayed Vs 2 or more Senior Officers who were subordinates of those who left

B 2 Senior Officers who left

2 Senior Officers who left and 2 Executives who were their Supervisors who stayed Vs 2 Senior Officers who stayed and 2 Executives (who were their Supervisors) that left

The design is an attempt to balance out factors associated with staying versus leaving, and supervisor's view of information needs versus subordinate's view. By trying to match supervisors who left with subordinates who stayed; and compare them with subordinates who left and supervisors who stayed, it is hoped to gain insight into the differing perspectives on corporate memory and also to validate the data against any biases. The purpose of the initial interviews conducted (Apsey, 1994) was to test in the extent to which the departure of senior executives may have had an affect on an agency's capacity to continue effective

Corporate Memory 12

management. Indeed, the approach was intended to assess the applicability of certain strategies suggested by Sharp and Lewis (1993) in the circumstances of an agency. CASE A: A South Australian Organisation Down-Sized The South Australian public sector has been experiencing significant changes as a result of downsizing and restructuring initiatives. (Apsey, 1994) The number of employees in the South Australian state public sector as at June 1994 was 105,836 persons (90,884 Full Time Equivalent positions) which represents a decrease of 4.5% since June 1993. If the separation figures for the period 24/6/94 to 30/6/94 are included the total state public sector workforce would have shown a 5.6% decrease (6,217 persons) during 1993/4. The large increase of separations during the last week of June can be attributed to the less generous separation benefits which came into operation of 1 July 1994 (Apsey, 1994; Office of the Commissioner for Public Employment, 1994) . Potential consequences arising from the organisational reductions and structuring include discontinuity of service, impact on corporate memory and the lack of capacity to respond. In this study it is intended to focus on issue of the price that is paid in regard to the loss of expertise, information and skill which may be taken by departing staff. Little empirical work has been undertaken in this area especially in relation to the departure of executive level staff from the public sector. Given the size of the reduction in personnel at this level, it is useful to consider this aspect in the context of the developing work which is focussing on the importance of "organisational memory" as a key to competitiveness and the delivery of quality service by organisations. The particular focus of this study is to examine the impact of the departure of most of the senior executive members from the senior management team of a public sector human services agency upon the capacity of the organisation to retrieve and utilise information for capacity purposes. This South Australian government human services organisation was considered a useful example to investigate because of the nine person executive team that had existed in December 1993, six of the nine members ( the interviewer was one of the six) had departed six months after the change of Government. Accordingly, it was decided to interview four executives who had been members of the senior executive team in November 1993 which was immediately prior to the State Election. The interviews took place approximately eleven months after the election. By this time, two of those selected continued in employment with the agency, and two had terminated their employment through the acceptance of voluntary separation packages. The individuals were selected from a total executive of nine to ensure that each category contained one executive who had significant line management functions in the operation of the prisons and community correctional centres. One executive in each category could be described as having senior functional "off line" responsibilities in regard to strategic planning human resource policy and practice. The two departed of the executives were selected because of their longevity of service within the system, and in all cases those selected were readily available to the interviewer. In the case of those who had left the agency, the departures had occurred approximately six months after the change of Government and the installation of a new Chief Executive Officer. All the executives were, or continued, to be long serving officers of the South Australian public service. All except one had over twenty years direct experience within the agency. In total their experience exceeded a century within the state public sector and at least sixty years within the agency.

Corporate Memory 13

It is to be recognised that a human service agency is different from the organisations studied in the literature on down-sizing. Typically such studies investigated the effects of down-sizing on large physical resource providers or manufacturing businesses where technical knowledge is at the forefront of determining competitiveness. The knowledge base within the agency in Case A is therefore centrally focussed on professional practices and procedures, client related data and policy development. The nature of the agency needs to be kept in mind when the perceptions of the executives is considered and the nature of the information and skill possessed by them is assessed from the viewpoint of retention. The Interviewer`s Approach For this naturalistic exploratory inquiry an unstructured approach was adopted (see Apsey, 1994). The range of questions which were utilised to draw out the officer's perceptions of the impact of the departures included the interviewee's: * specific functional relationship in respect to other executives in regard to the key decision

making processes; * perceptions of the most significant issues/achievements in relation to which they have had

direct responsibility; * perceptions of the skills, experience, and knowledge that enabled them to contribute to the

issues/achievements; * perceptions of the extent to which the perceived skills, experience, and knowledge were

stored in data bases within the organisation; * view in regard to whether or not those skills, experience and knowledge were stored in

data bases within the organisation; * view in regard to whether or not those skills experience and knowledge have in any way

been stored or transmitted to others prior to departure from the organisation; * recall of whether any measures were taken by the organisation or any person within it to

ensure that the skills, experience and knowledge were captured prior to departure; * recall of the extent to which and in what way they perceived at the time of departure that

their absence and the consequent loss of skill, knowledge and experience might impact on the organisation`s capacity to function or manage critical issues;

* recall of whether they subsequently have any knowledge of whether or not their perception

of the consequent loss of skill, experience and knowledge did impact on the organisation`s capacity to function or manage critical issues;

* suggestions in regard to steps that could be have been taken by the organisation to ensure

that skills, experience and knowledge were not lost upon departure. RESULTS: Common Issues Identified By Executives In Case A Perceptions of change

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It was universally stated by the four interviewees that the Department had been through a period of dramatic change (Apsey, 1994). In the case of one executive it was suggested that the change was of such a magnitude and had been so rapid for staff that it may be too early to assess the issue of impact on information and organisational memory. Staff were so busy coping with change that they "have not had enough time to dwell on the past". It was suggested that a new Government often has limited interest in the past as it is eager to place its own stamp on a new direction. Perceptions of the degree of change were not to be underestimated. One executive described the post election organisational atmosphere as being that of a "state of shock" and a "turbulent hole" within which much decision making was "on the run". Further, it was observed that the new Chief Executive Officer who did not have any previous correctional experience brought a new and different administrative style and that this had given a new focus and importance to resource/support services. The interviewee who made this observation was of the view that this area had previously "struggled for recognition" because the predominant cultural values were those which emphasised correctional philosophies. A major endeavour to delegate financial resources and personnel functions to the field had been made and the reporting relationships which had previously been seen as significant in regard to accountability had been relaxed to some degree as a result of the new Chief Executive Officer`s style. Documentation and Information Flow It was generally considered that the documentation in relation to policy and the recording of the reasoning behind its development was very strong. It was suggested by most of the interviewees that this was in large part because of the management focus during the 1980s to develop systems of accountability which would demonstrate in the context of any public inquiry the reasons for particular decisions and the policy framework in which such decisions were made. It was also suggested that the experience of Government reviews and inquiries during the preceding fifteen years had demonstrated the importance of maintaining high levels of accountability and that the emergence of a broad Australian wide correctional philosophy emphasising the principles of humane containment and normalisation as core elements had been vigorously articulated as the framework for correctional administration. Most interviewees said that there was limited information which was of critical value in regard to decision making that was "lost" as the result of the departure of top executives. In two cases executives expressed their surprise at what they had thought at the time may have been a greater loss than they had actually subsequently experienced. One stated that he thought that "at the time that the hole would have been larger than in fact has occurred", and another said that "at first blush when considering the questions thought the loss would have been great, but that on reflection this was not the case". It was considered that the information that had been taken was of a personal and anecdotal nature, and predominantly related to individuals who remain within the system. One interviewee said that "he did not take anything in his head of life shattering significance", and that the personal information in relation to individuals which he recorded but did not keep was of "little consequence" and that he "did not regard it as proper to hand this material on to others as it was important to allow new people to make up their own minds". It was suggested by one of the departing executives that this information stored mainly in the memories of individuals could, if retrieved, be the basis for the development of an "oral" history which provides recognition of the past contribution of individuals, and the historical context in which they lived and contributed. It was suggested that "most of this was anecdotal material which would have been of some interest to the history of the organisation".

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Implications of departures of key Executive staff on critical decision making There was a perception expressed that whilst there was a strong information base, the influx of new individuals and the pressure for change which occurred with the expectations of the new government meant that the implications of some issues were not always thought through, and that the " sounding " board role that had been performed by some of those who had departed had disappeared as a basis for experience and judgement. However, it was suggested by all interviewees with equal force that this view needed to be balanced with the acknowledgment that a new team together with a vigorous consultative style had drawn in new perceptions that were valuable. The feasibility of capturing personal soft data and the need for an appraisal system The case study suggested that the information that was removed from the organisation in regard to the performance of a range of individual staff memders with the departing executives could have been captured had there been an appropriate personnel appraisal system developed which would have been the repository for this data. The information collected could include that which arose from personal contacts, and other personal soft data relating to staff. Interviewees were, however, a little ambivalent about the use and value of the data. It was recognised on the one hand that there was considerable information that had been used to ensure that appropriate persons who were sympathetic to the organisation's paradigm and who were considered capable of producing sound results were promoted or given " crown prince " development options. The corollary was that there were some who did not fit this mould and were not promoted or possibly given the same development opportunities (Apsey, 1994). This was simultaneously seen as desirable and possibly a restriction by two interviewees. On the one hand it was considered that an amount of information about the performance of individuals was taken by the departing executives either through the removal of personal records (or personal hard data) or the material held in their memories referred to by Sharp and Lewis (1993) as personal soft data. On the other hand, it was also acknowledged that others who may have not been seen to fit comfortably within that mould may now be given the opportunity to develop and flower. The major concern was the absence of a soundly structured personnel appraisal and development system which could provide the basis for the future growth of the agency. In this context the interviewees were arguing for sound, objectively based competency requirements, proper assessment, and developmental opportunities, but also suggesting that their considerable experience in regard to the capacities of people was being lost because there was no properly structured way to record and evaluate such material. Importance of development of senior staff prior to the introduction of a comprehensive

appraisal system It was suggested by one executive that "the absence of an appraisal system is a real problem", and that this "became evident in the selection process when staff at a major prison complained that they had never had any feedback or assessment". However, caution was raised in regard to the introduction of a system where competencies had only been recently introduced for the base grade staff, and the need to ensure that senior staff are sufficiently prepared for the systematic undertaking of appraisal and development of their staff.

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Improvements to Information Technology as the result of organisational change. An issue raised by an officer who remained was that the influx of new skills in a number of positions had resulted in a major focus on the extension and refinement of information systems. Mention was made of an increase in availability of personal computers in Community Corrections offices, refinements to the Justice Information System, the development of a reporting system by locality that provides access to a range of management information, and a significant advance in the delegation of budgets to workmates. The relationship of the time and planning for departure on information and skill retention One aspect of the impact of the transition from critically useful executive to retiree was the timing. Both the departing executives were selected because they each represented either operational or "off line" functions, had significant longevity of experience within the correctional system, and were readily available.(Apsey, 1994) In each case there was approximately six months between the change of Government in December 1994 and the final date of departure of the executives which provided the opportunity to reflect on the nature of the information they were leaving behind. Whilst both individuals considered that the information base they were leaving was quite strong, and believed it was important to brief those who remained through briefings, or the deliberate development of individuals who would remain in the "structure" that had been built up and "coaching" programs for key personnel. One executive stated that "in the last six months he concentrated on handing over and briefing others, increasingly stepping back". This was to ensure that there was a continuity of knowledge base, and to pass on the reasoning behind the decision making processes that had been critical in the view of the interviewees for the successful operation of the previous management team. In this context, these perceptions give support to the view that both the information itself and the decisional capacity provided by the individuals as distinguished by Walsh and Ungston (1991, p.61) were retained in large measure. However, whilst the departing executives did not think that shortage of time was an issue with regard to their capacity to properly " hand over" to those who remained, they did consider that it was they who had made a focussed commitment to ensure that their knowledge was passed on. Both believed that a more structured method of "debriefing" would have been of value as it would have been easy, had they chosen, to have left without undertaking the work they did to systematically pass on relevant information. (Apsey, 1994) Possible implications for information and skill retention at less senior organisational levels. An observation made by one of those who remained was that whilst the continuity had been maintained at the executive level through endeavours to hand over information and ensure that critical policy development was understood, it may well be the case that at less senior levels in the organisation it is found that many who left took critical operational information with them. In excess of one hundred staff accepted separation packages, and it was suggested that there were few if any exit interviews conducted. It was suggested that this loss is now broadly recognised, and that exit interviews developed on a properly structured basis are of great significance. It was suggested that in contrast to the well developed systems and information which was left by departing executives, the rapid departure of custodial operatives at more junior levels has left deficiencies in relation to the "know how" of managing prisons in a practical context. It is suggested that further work could be undertaken to explore the extent to which experienced custodial staff took valuable knowledge and skills with them and the impact on the functioning of

Corporate Memory 17

prison operations. Whilst competency levels have recently been introduced for base level custodial staff, and it is assumed that the majority of departing personnel would have been the longer serving officers for whom separation packages would have been attractive. Views in regard to post separation consultancy Both of the departing executives considered that they could be usefully engaged in an advisory "elder statesman" role. Neither of the departed executives expressed a supportive view of the suggestion that they or others in similar circumstances should be directly engaged as consultants in relation to direct departmental work. (Apsey, 1994) It was of interest, however, to note that even the limited view of returning to "arms- length" consultancy work as described above was not shared with the same strength by the executives who remained. One of the remaining executives made the following comments: -"the skills of the agency are there now, and the skills to manage are present...it could be detrimental ( to recall such executives ) as the views of those who have gone have now dated" - "on the basis that the world has now moved on and style and skill at a senior executive level becomes quickly dated". Further, it was suggested in one instance that given the speed of change it may even be detrimental if such separated officers were to be recalled directly into consulting work. The issue, of course, from this perspective was that of the balancing of continuity and operational knowledge within the executive team and the presence of new people with new skills. (Apsey, 1994) CASE B: A DELAYERED (COMMONWEALTH) DEPARTMENT The other organisation studied was a Commonwealth Government department with a more commercial purpose and requiring more clear technical operations (e.g., involving property management, transport, etc.). It had closed at least two sections of its regional operations in the state office used in this study. So far one senior staff member from each of these closed sections have been interviewed, pending interviews of at least one member who was retained in the department (albeit in different jobs). Of course this part of the study is less interpretable than in Case A, because as yet there is no comparative data from those who remained in the organisation. However, both interviewees were still associated with former colleagues who remained in the organisation. Indeed, one of the interviewees was actually re-employed by the same section (which had lost 9 out of the ten technical staff in that section) when it was found that they were not able to carry out some of the technical functions he had been responsible for when in the organisation. Again the same approach to the interviews and the same basic questions were asked. This time the study was conducted by another interviewer, but like Case A, the interviewer had also been one of the senior staff who left the organisation during its down-sizing. Difficulties in information storage and retrieval

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Both interviewees, although from different sections of this department, had indicated that as far as they were aware any database, guide-lines etc. within their sections had been allowed to deteriorate to the point of being significantly out of date prior to the re-structuring of the department. No Prevention of Corporate Memory Loss Neither of these interviewees was aware of any precautions being taken to retain relevant corporate knowledge from the departing staff. They did not experience nor did they know of any exit interviews of departing staff, nor other measures taken to retain or capture skills or knowledge of departing staff in either of the sections concerned. Despite some contraction of work generated in the organisation as a result of the contraction or delayering of these sections, both (according to the interviewees) took steps to hire contractors to conduct work which was previously done by the staff in that section. Indeed in one case the work load of remaining one staff member had escalated to the point where that person could not keep up with it and so one of the interviewees, a "retrenched" former employee, was re-hired. Implications of departures on critical decision making Neither of the interviewees gave any detailed estimate of the degree of impact of the departure of personnel and their respective knowledge and skills (corporate or personal). However, they acknowledge there would have been some benefit (or perhaps some improvement in the transition of operations) if the department's representatives had taken some precautions to retain relevant corporate information. Indeed both were gave specific comments about their suggestions as to steps which could have been taken to capture relevant skills and knowledge. These suggestions included: * for the operators and technical staff to update the technical and client contractual

documents, databases and standards of operation before the down-sizing; * for the "management" to become aware of the skills of their staff, and to implement a system

for auditing or capturing an inventory (database) of the relevant skills needed for the tasks of the organisation, even including the academic qualifications and experience required of the positions employed in the section being closed.

DISCUSSION OF CASE STUDIES Limitations of the Methodology To Date Although these findings are very limited by methodological limitations, they are a step towards adding evidence that corporate memory loss can be addressed. (Apsey, 1994) It is appropriate to consider the limitations of the methodology before attempting to draw any implications or outcomes from the interviews. Obviously this is still work in progress and the interviews are not representative of the organisations as a whole, nor are the results generalisable to other or similar public sector organisations.

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Bearing these limitations in mind, it should be remembered that these comparative case studies were an attempt to gain something more than the vague or informal or anecdotal comments that abound in this field. There are some commonalities between these cases and the anecdotes available, viz:, the following: a) there was implicit or explicit agreement that corporate memory loss is or could be a

significant problem for organisations which have delayered as well as those which have down-sized in an ad hoc manner;

b) the degree of corporate memory loss could depend on, or be reduce by, the communication

and precautions taken by the department's management to anticipate the needs for continuity of information (as in Case A), although in Case A it appears this was achieved more by the goodwill and anticipation of the key senior staff than any conscious policy of the department;

c) individuals did seem to agree that it would be worth while for organisations to institute

some form of skills audit and some type of exit interview which may assist the process of retention of relevant corporate memory, as raised by Sharp and Lewis (1993).

The interviews were conducted to assess the extent to which departing executives took with them information which was critical for ongoing decision making requirements which was not available in electronically encoded form or otherwise recorded in printed/published or written form. It was intended to assess the extent to which departing executives removed or by their absence prevented ready access to material thereby making it difficult for the agency to manage. It was hypothesised that it is only through the corporate hard data that the organisation has (relatively) ready access to critical information either through a systematic method of access or reliance on memory. On the other hand, personal hard copy data, which is defined by Sharp and Lewis (1993) as individual personal records stored in hard copy, is not usually accessed unless such material has been deliberately placed into an approved departmental file. The latter material may be held in personal files, personal computers, diaries or memoirs and its existence may or may not be known to others besides the author. (Apsey, 1994) Sharp and Lewis (1993) and Dunford (1994) have suggested that rapid downsizing in organisations and changes in policy suggest that there is a danger that strategic decisions may not be taken to allow the systematic recording and retention of critical information. The consequence, it has been suggested, may be a myopia or memory loss which is unproductive as organisations constantly reinvent the wheel in their endeavours to find solutions to problems, and the absence of highly experienced individuals, weakens the "glue" of continuity which would have permitted wise and balanced decision making. The phenomenon of downsizing has also raised the issue of the extent to which the possible disadvantages this scenario brings (through the loss of skill) is counterbalanced by gains in flexibility, new ideas, and a breaking of habits, policies or strictures which have constrained the new approaches. The outcome of the current interviews with executives within two public sector organisations throws some light on these matters, and suggests that the impact of these departures of senior staff have differing effects depending on the circumstances under which they prepare for their departure. Thus certain techniques proposed by Sharp and Lewis (1993), may or may not be of use depending on the perceived need for precautions.

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The information provided by the executives in Case A suggests that generally documentation regarding policies and reasons for them existed in hard data form in files, and that the "soft" data taken by individuals was of lesser importance. (Apsey, 1994) It was not suggested that there was significant encoded, or otherwise documented, material that was not readily retrievable by staff who remain. All four interviews associated with Case A stressed that they considered that there were no significant gaps left in the information repositories as a result of the departures in large part because of the solid commitment over a number of years to properly recording policies and the values and debates that underlay their existence. However, the absence of a sound appraisal system was viewed as a weakness. Moreover, the key to the way information was used had depended in large measure upon the timing of the departures of the executives and the importance of a sound debriefing in relation to the locus of information and the way key policy and strategic matters had been approached was considered as crucial. In the cases of the departing executives there was a concern that a more structured approach to debriefing would have been desirable and that the transition which occurred after their departure was as smooth as it was because of their own individual efforts to ensure that what they considered to be critical was passed on. (Apsey, 1994) In Case B, however, in both sections it appears that the recording systems for storage and retrieval of corporate hard data were either not up to accommodating significant soft data, or they were sufficiently out of date to render them unreliable and/or not worth re-establishing as part of the down-sizing. Both interviewees indicated that no precautions had been taken to accommodate the information needs of the re-structured department at their level. Whether these circumstances were significant contributors to the changes in workload was not clear from their evidence. Reflection on Methods of Personnel Appraisal and Management Information Systems It is useful to reflect on the outcome of the interviews for the implication and conclusions raised by Sharp and Lewis (1993) in relation to specific issues which are suggested as being worthy of consideration in the designing of management information systems. To this end a summary is provided of the interviewees` comments (Lewis, Sharp & Apsey, 1995) in relation to the recommendations/hypotheses raised by Sharp and Lewis(1993). These comments are interpreted as follows.

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Exit Interviews In Case A, the senior executives did not favour the application of what was viewed as simplistic exit interviews in relation to their own situations. However, it was considered that a structured approach to thinking through the implications of the departure of executives, and the conscious reflection on the implications of their departures is an important role for Chief Executive Officers. Both departing executives (interviewed separately and independently) considered that it was through their own commitment that they were able to adequately brief relevant personnel in regard to critical matters, and that a more structured approach would have been valuable for focussing the minds of senior staff who remain on what areas require particular attention. The interviews provided strong support for the view that a structured approach was desirable to the planned departure of executives in order to optimise the smoothness of transition. The executives all believed strongly that the reason that a significant vacuum did not occur in the wake of their departure was in large part because they put substantial time and effort into briefing key staff and that others of different disposition may not have taken this course. Regarding the down-sizing organisation in Case A, although considerable information had been retained at the executive level, there was concern that it was at the less senior levels that exit interviews were crucial and that a considerable amount of experience had departed from the agency as the result of custodial staff departing and taking repertoire of knowledge with them. This would suggest that the future focus in this regard should be targeted more at the junior and middle management levels. Nevertheless, in Case B the two interviewees did see exit interviews as worthwhile as a minimum requirement to investigate the potential impact of the departure of staff. In summary, the technique of exit interviewing was supported at least for use with the less senior operational personnel with the agency. Whilst accepting this techniques as a useful one, the limitations noted by Dunford (1994) that exit interviewing may reduce the organisational memory problem but, in itself, the technique is not a total solution. Dunford (1994) observes that the nature of tacit knowledge is such that much is not at the forefront of consciousness and the interview may not necessarily elicit a great deal, and that the usefulness of the technique is likely to be limited by the predisposition of the interviewee towards being "helpful" in a downsizing - induced exit interview. (Lewis, Sharp & Apsey, 1995) Disposal of Personal Records The interviewed executives all contended that there was little disposal of personal records with the exception of some information about individuals. This latter material, it is suggested, may be appropriately incorporated into a properly developed appraisal system. (Lewis, Sharp & Apsey, 1995) At the senior level, based on this case study, it would appear that a properly structured debriefing process would address this issue, and indeed would not seem to be a very significant consideration in those instances where there has been significant team building developed, and a broad involvement of staff in policy development and organisational acculturation. However, in the Commonwealth organisation studied in Case B, no such precautions appear to have been taken. Limitations of New Technology

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Sharp and Lewis (1993) observe that an assumption that technical solutions alone will solve corporate memory problems is naive, as it is the experience and "know how" which expert systems will not be able to entirely replace. The current case studies would support this perspective as it was emphasised by all executives that not only was the policy related documentation sound but the departing executives deliberately set out to "hand over" through discussions with others the state of development of particular issues. This process, it has been already commented, Case A built upon a base of solid executive team work where a corporate approach had increasingly been taken to decision making. Ongoing Consultancy It has been suggested in many contexts that problems can be reduced by retaining the exiting personnel on a consultancy basis to be recalled as required. If it is assumed that this is a desirable course of action to pursue, one major problem which is faced by executives who have accepted separation packages in the South Australian Public Service is the condition that they will not be engaged by the public sector for a period of three years. While particular arrangements are currently being developed with regard to the outsourcing of major whole - of- government functions, such as in the area of information technology which will facilitate engagement in the context of the public sector, generally speaking senior executives would be unlikely to come within such exceptions. Whilst it appears that the intention of policy is to maximise cost savings to government, the question must be asked whether an appropriately selective approach has been taken with the intention of identifying particular areas of expertise loss and allowing for consultancy work to be undertaken by departing executives. (Lewis, Sharp & Apsey, 1995) A similar contractual constraint is applied in the retrenchments offered by Commonwealth organisations. However, at least in one of interviewees in the Case B organisation seems to ignored this constraint and employed the interviewee back on a contract. One of the outcomes of the interviews in Case A, was that not one of the four executives thought that it would be an advantage for those who had separated to become actively involved again directly in departmental work. Those who had departed indicated that they had not been approached in relation to the provision of information, and that it was useful to let the new team get on with the task in an unencumbered way. Given the view that the information base which had been developed in regard to key policy issues was sound, team work development had been good, and briefing of those who remained had been quite thorough, none of the executives could see real value in recall for the purposes of consultancy. (Apsey, 1994; Lewis, Sharp & Apsey, 1995) GENERAL CONSIDERATIONS FOR FURTHER RESEARCH The limitations of the method and simple comparison of the cases available are obvious. Apart form the limited convenience sample and the an structured naturalistic approach, there is a major problem of depending on the accident of individualistic recall and other conceptual whims of the interviewees. (Lewis, Sharp & Apsey, 1995) This vagueness is the subject of an attempt to develop a set of more structured data collection instruments. To address this corporate memory analysis we recommend gathering information from organisation members, their supervisor, their peers and their sub-ordinates. In this way a comparison of the data available in hard and soft form will begin to expose what may constitute the components of the corporate memory window outlined above. Thus it is hoped that the potential areas of susceptibility to corporate memory loss can be exposed for strategic assessment.

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STRUCTURED RESEARCH APPROACH To complement the naturalistic methods outlined above, the research program is also developing a more structured approach to gathering corporate memory data through a set of questionnaires. These instruments are based on methods from psychological research on cognitive mapping and personality constructs. Relevant Psychological Instruments from Personality Research The psychological research on personality theory and psychotherapy has produced concepts and methods which have more recently been of interest to researchers of knowledge modelling. Especially relevant are the methods inspired by the work of personality theorist Kelly (1955) and psychotherapy researcher Stephenson (1953) who have founded methods which seem useful in corporate memory research. Here we will examine some of the applications of their personality and psychotherapy research methods in other fields which indicate their relevance to organisational memory or corporate memory research. The particular research methods are the Role Construct Repertory Test (Kelly, 1955) also known as the Repertory Grid (Latta & Swigger, 1992) and the Q-Sort (Stephenson, 1953) which has been developed into organisational applications such as the "Performance Priority Survey" (Barrett, 1995). Q-Sort Rogers' (1959) psychotherapy and personality theory led to the need for a method of clarifying and understanding the cognitive processes of clients in counselling. The Q-Sort method was developed (Stephenson, 1953) for these purposes. Subsequently it has been developed into organisational applications such as the "Performance Priority Survey" (Barrett, 1995). Barrett (1995) adapted the Q-sort technique to form the Performance Priority Survey (PPS) which he used in research on the differences in perception between supervisors and their subordinates, in this case among the Fire Fighters . Repertory Grid (REP grid) Kelly's (1955) Personality theory led to the research method known as Role Construct Repertory Test also known as the Repertory Grid (Easterby-Smith, Thorpe & Holman, 1996; Latta & Swigger, 1992; Shaw, 1980). Latta and Swigger (1992) applied this technique to analysis of "commonality" of knowledge among students and lecturer in a University course on computer storage and retrieval systems. They first had the lecturer select ten computer systems elements, which were:

"databases, computer, record, search term, logical operator, posting, retrieval set, document, commands and terminal." (Latta & Swigger, 1992, p. 119)

Then the students were requested to select any two from among this list of elements given by the lecturer. The students had to state the similarity between the 2 chosen elements (this became the underlying "construct"). Then they were to select a third element and describe how it was different from the first 2 elements (anchoring the other end of the bipolar construct). This process was repeated until all elements had been considered as the first element in a triad. Students were

Corporate Memory 24

allowed to select their own combinations of terms in any order they chose, as long as each of the elements was selected at least once to be the first element in the triad of compared elements. By these comparisons the various "constructs" were elicited as dimensions along which the elements were similar or different. The first two elements chosen as similar according to the underlying construct and the third element different on that construct. These constructs were given back to the students with 5 point rating scales attached to each construct. They were asked to rate each of the 10 elements on each construct, using the following five point scale: STAGE 2: DEVELOPING RESEARCH INSTRUMENTS As most recent organisational research has been done on the Q-sort (Barrett, 1995) this is the technique adapted first for the corporate memory research, here. Methods Basically we adapted and extended Barrett's (1995) Performance Priority Survey (PPS) by using statements relevant to the corporate memory issues and setting up a rating of the information in terms of relative strategically importance, and by adding two extra columns which allow the participants to identify whether the information was gained or lost in the situation or whether the answer to this question was known or unknown. Combining these factors the survey was named accordingly: the SIGNUL survey letters of the stand for the following: S = Strategic I = Information G = Gained N = kNown U = Unknown L = Lost This data is to be collected using Questionnaire 4 below.

CORPORATE MEMORY 25

The draft instruments are attached. These instruments are in the process of being trailed with ten middle managers from various sections in a large national Government agency. The data are not yet fully collected nor analysed. However, a wide-spread reaction from the participants at this stage is that the instruments are too complex. They also have found some difficulties in complying with the requirement to match the data collection from subordinates and supervisors. One of the difficulties is the ethical concern of the subordinates about the process of matching the data with their supervisors. ORGANIZATIONAL LEARNING: THE EXERCISE OF CORPORATE MEMORY ? As with the human body's muscles and memory: 'if you don't use it you loose it' (Cohen, Kiss, & Le Voi, 1993) . There is increasing emphasis on survival of the fittest in international competitiveness, we are told there is a corporate international organizational learning race (Hampden-Turner, 1990, 1992). In order to survive in the 1990's organisations are told they have to model themselves on the learning organisation. All these metaphors imply not only the need for exercise of corporate strategies, but also the exercise of corporate memory. Indeed, it could be argued that organizational learning is the exercise of corporate memory. By revealing "tacit knowledge" (Nonaka, 1991), and by rehearsing and reviewing the relevance of soft and hard as well as personal an corporate data, the organisation can exercise, and presumably build, its corporate memory capability. To continue the metaphor evaluation can be the memory rehearsal mechanism which helps to recall and prioritize corporate memory of vital data, for decision making as well as to discard what is not needed and to assist in anticipating and rehearsing the costs and benefits, strengths and weaknesses of strategies in the development of the organisation's strategic management. SUMMARY AND CONCLUSIONS If the findings of Case A are true, and if they are able to be replicated, it would suggest that it is possible to limit the extent of the loss of information and decision making capacity within an organisation under-going down-sizing.(Apsey, 1994; Lewis, Sharp & Apsey, 1995) The Executives who remained in the Case A organisation, were able to manage the departure of key senior staff to reduce the loss of corporate memory. This may have been conditioned by the strength of the corporate hard data base information base which was left behind (whether in the electronically encoded or documentary form). This limited or unfelt damage to corporate memory also may be contingent upon the length of time that departing executives are permitted to debrief others who may take their place, and upon the skill mix of those who are introduced into the executive ranks. It also may be a consequence of the lack of awareness of the significance of the soft data in determining the extent of any felt impact. (Lewis, Sharp & Apsey, 1995) If senior staff are not aware of what they are missing how can they know its absence had any impact? However, we can say that this research so far has had mixed results and has not indicated solid support for a universal loss of corporate memory consequent upon the departure of executives. The need for further systematic research in a range of public sector contexts (line, central, human service and other agency types) is particularly important given the current emphasis which is being given to importance of mobility within the public sector. The prevailing view seems to favour enhanced mobility as a means to providing flexibility within the service and equipping executives with the capacity to meet new and varied challenges. However, in the light of the lack of relevant Australian case studies concerning the effects of organisational change on management information

CORPORATE MEMORY 26

systems there is a serious concern that this deficiency may combine with the increasing turn-over of key staff to leave organisations vulnerable to corporate memory loss. The difficulty in obtaining access to the qualitative, personal, confidential data, and other pertinent information, is a severe stumbling block to research in this field. The present paper has briefly mentioned two case studies, which are interesting in their introduction to this topic, but greatly in need of elaboration, replication and extension. There are also logistical difficulties of obtaining information from staff who have now left as they are either uncontactable, unwilling or who themselves are not aware of the information that was relevant. Information would have been destroyed in the hard copy form (Ph), or unrecognised and/or forgotten in the soft form (Ps and/or Cs). There is a need for research on such practicalities if the anecdotal evidence of gaps in knowledge or missing information, such as was found in the organisations studied, are to be more precisely investigated. Computerised Analytical methods To address the need for a method which can diagnose organisation memory, which is able to be applied to documents of organisations, this paper draws on the work of Jewell (see Jewell, 1993; Jewell & Linard, 1992). He has shown that the information management capabilities of Lotus Agenda and its offspring Lotus NOTES are useful in analysing the semiotics of organisations as expressed in the corporate documents. To address the need for clarifying the theory and modelling the data, this paper proposes a research methodology which aims to develop a computerised model to test hypotheses concerning the influence of staff turn-over and "down-sizing" on the corporate information systems in public sector organisations. Vo (1992), showed that computerised dynamic modelling software can be applied to simulate and investigate the effects of staffing changes on "corporate knowledge" in a public sector organisation. The software is called "Ithink" (based on the "Stella" dynamic modelling package for Apple Macintosh computers). So apart from further case study research the authors are involved in the replication of Vo's model in the particular organisations studied above. It is hoped that such modelling will lead to better understanding of the strategic significance of such human resource management processes. It is interesting to reflect on the experience of the four executives of Case A. They were members of a senior executive of eight team within a large public sector human service agency during a major transformation, which included four of them leaving. We interviewed two of those executives who departed, and two who remained. The expectation may have been that such a major change in the composition of the executive team within six months would have had a significant impact upon the information bases of the agency and its capacity to functionally operate. However, the interviews revealed that the expected impact on the loss of information and decision making capacity seemed to be counteracted by the way in which the agency developed its documentation of key data and policy related materials, the steps taken by executives to debrief others and otherwise maintain continuity, and the length of time between deciding to leave and actually departing. The impact of the loss appears also to have been ameliorated by the introduction of new staff with appropriate skills to provide an appropriate mix and balance as others depart. Furthermore, the absence of a highly developed computerised system in the context of policy documentation of that human service agency has not appeared to limit the capacity of the agency to function at the executive level. (Apsey, 1994)

CORPORATE MEMORY 27

While it is unwise to generalise beyond this organisation, it is emerging as a common belief in the literature that appropriate human resource management strategies which recognise "corporate memory" within organisational strategies, can lead to planned transfer or discarding of elements of corporate memory. Such an approach to management of corporate memory is expected to have benefits within a more appropriate overall human resource management strategy to cope with turbulent organisational change. (Lewis, Sharp & Apsey, 1995) In any case, from first principles and available theory, it is thought essential for organisations to plan and manage their capacity for retention of organizational learning. However, there is little systematic research available in this field to bring to bear on these contentions. The research methodologies introduced here are beginning to bridge the gap between theory and research and practice. But there is a great need for further research into corporate memory loss and how to prevent it. Thus at this stage it would be premature to answer the question posed above. Before it is possible to investigate the significance of corporate memory loss on organizational memory it is necessary to have suitable methods of assessment of both concepts. The present research program is moving towards instruments which can assess corporate memory loss and also to assessment tools for measuring if and when organizational learning may be affected. The next stage of the research program (introduced above) intends to develop more rigorous instruments to gather data on the concepts which are common among staff (shared corporate memory) and those which are unknown to other staff and so susceptible to corporate memory loss if the key member was to leave. BIBLIOGRAPHY Alter, S.L. (1980) Decision Support Systems: Current Practices and Continuing Challenges.

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manag\orglgc96\orglgm96.doc

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“Companies Never Remember

Advertising departments would profit from continuity of experience, independent of shifting personalities”

By Catherine Woolley

The author is desk editor of the Architectural Record, published by the F.W. Dodge Corporation. For a number of years she was with the American Radiator Company as copy writer, sales promoter, and editor of the company publication for salesmen. She has also done some free-lance writing, and for ten years has been local correspondent from Passaic, New Jersey, for the New York Times. "Did we ever run a prize letter contest?" "I think we did, when O'Riley was here." "Any good?" "That's too far back for me." So runs the pattern for a conversation that any advertising man has heard. No one in the company now knows whether that contest was a success or a terrible flop, because O'Riley is gone and the company hasn't any memory. So the scheme is tried again. Maybe it's another mistake. And in any case the details must be worked out from scratch. O'Riley had the whole contest done up in portfolio style, but he took the only one left in the files along to his new job. In two large organizations where I have worked it was the same story. Every campaign considered or actually carried out by the advertising department stood in relation to the company as a pioneer effort, an experiment without precedent and without any gauge of experience with which to measure its possible outcome. Yet it is hardly conceivable that during the fifty-year lifetime of each of those companies, any promotion scheme could have escaped scrutiny and trial in one form or other. Granted that a campaign can scarcely ever be repeated in identical form, or could be expected to produce the same results a second time, the tabulated history of a specific advertising campaign conducted in 1926, for example, would certainly be a useful guide in plotting the complicated details of a campaign based on similar principles in 1941. Such a waste of valuable experience appears to be as unnecessary as it is sad and unsound. There are two reasons to explain it: the rapid turnover of personnel in advertising departments; and the tendency of the new man to shy away from projects fathered by his predecessor - because, of course, he was hired to bring in "new" ideas. Nobody dares to mention what "we used to do" for fear of being an old fogey, so past experience quickly fades into oblivion. Result: The company gains the accumulated experience of the new man, learned in a different field or under other conditions and so, for a time at least, to be valued slightly under par value. But the experience of the former advertising man goes out of the company with him. There may be a net gain, but something is lost, too, in the exchange. Whether his

CORPORATE MEMORY 33

campaigns put figures on the black or the red side of the ledger is beside the point here. The knowledge of results, good or bad, that were obtained under his or any régime has value for the company. Yet this knowledge is usually preserved within the company, if at all, only in the memory of some perennial slave who has neither the incentive nor the opportunity to speak up, and would scarcely be heard if he did. In the best business circles, walking off with company records, or the office furniture, isn't done by employees or countenanced by the employer. But it is truly amazing how, time after time, advertising men - innocent indeed of a crime that only the company commits - are allowed to get away with the only knowledge in existence of what was done and how it turned out. O'Riley moves on to a better job. And with him goes all the experience and wisdom the company paid him to accumulate. Does the company keep a copy? No, it starts in all over again to pay somebody else to learn and make mistakes. Fortunately, business concerns are not like human beings, who begin anew because they cannot inherit the bundle of experience with which their fathers staggered out of the world. Business is constantly making fresh starts, and it should be possible to pass on what has been learned by providing the company with a memory - memory that would continue to register regardless of changing personalities. While business cannot, of course, be built on merely repetitive motions, it should be possible for McGinness to avoid at least some of the mistakes O'Riley made at the company's expense. This job would involve an historian, and the company history would be written not in terms of success stories but in tables, charts, analyses, descriptions and deductions that would explain the success or failure of every advertising campaign or promotion plan entered on. This record would be the official minutes of the advertising department, divorced from personalities now happily or otherwise departed. And research into the minutes would preface the planning of any new activity. Such a history could not be compiled by the house-magazine editor, or in a copy writer's slack hours. The historian's job is mature and responsible, requiring close contact with executive, engineering and statistical departments as well as advertising and sales, and verges on the librarian's premises when it comes to producing a record that will be readily fileble and accessible for reference. The historian must be the servant of the advertising department, in that his co-operation in producing all data bearing on a contemplated project can be taken for granted. He must be adept at eliciting information from the reluctant and the huffy, who think it all nonsense. And he must enjoy the complete confidence of the powers. In very large concerns he may have to be a whole department.

Executives will scoff, and wave at rows of files. Yet how many of us have watched some ill-fated venture of an advertising man who had no mother to guide him - while the ghosts groaned with warning and reproof. And what copy writer has not chewed his pencil and muttered "I wish I knew!" Somebody does know what that very copy slant did three years ago, but he has a job in Kansas City, and that particular section of the company's memory has been effectively and permanently removed. Those frustrated in a frantic hunt for clues would gladly assist at an operation to graft a memory on the company's other mental equipment.”

NOTE: This paper appeared in .(Bulletin of the Business History Society, Vol. XV, No 4,

October 1941)

CORPORATE MEMORY 34

Original Editors note: This article, which appeared in the September, 1941, issue of Printers' Ink Monthly, is reprinted with the permission of the Printers' Ink Publishing Company, Inc. We believe that it will be of interest to readers of the Bulletin because it so effectively states a need which is as real for business in general as it is for the advertising industry.

CORPORATE MEMORY 35

Draft (26th June 1996)

Dear _____________ Thank you for agreeing to participate in this research on corporate information awareness. The reason for this research is that we are concerned that there are increasing instances of staff leaving organisations where there is uncertainty about what information they have which may be important to the organisation, and how that information may be stored or retrieved. This survey is part of a review of the information storage and retrieval needs of organisations. In the organisation in which you work, we are interested to find out what you think are the important types of information for strategic decision making. General Information In order to help us all to be clear about the focus of this research, we define the following key terms: • strategic information is that information which might be relevant to management decisions

affecting the strategic direction of the organisation (or major part of the organisation) in the next year or more; such information could include informal advice or documents from clients, or from other organisations as well as from other staff in your organisation;

• operational information is that information which might be relevant to day-to-day operations and management decisions affecting the organisation's practices (or the practices in a major part of the organisation) in the next year or less; such information could include informal advice or documents from clients, as well as from other staff in your organisation;

• hard information is information stored in some reproducible form; it could include hand-

written or printed papers, data stored electronically in computer disk, or email; • soft information is information stored in human memory and could include personal

observations, advice from others, memory of reading of documents; • storage of information is the keeping of information in some form, intentionally or

otherwise, so that it can be used or found again; • retrieval of information is the finding or using information from some form of storage.

CORPORATE MEMORY 36

Confidentiality We appreciate you are busy and remind you that you are not obliged to provide this information if you do not wish to. But if you can, it would be very useful for the research if you to fill out the sections of the appropriate form and return it to us (see address below). If at any time you are unable, or do not wish, to continue the questionnaire please return it anyway. These responses will be kept confidential, and no individual responses will be able to be identified in the summary, analyses and reporting of the findings. If you are unsure of any aspect of this research please feel free to call me on 015 790 030. Yours faithfully, Colin A. Sharp Associate Professor of Management

C:\FUres\corpmem\CMinfoQR.doc

CORPORATE MEMORY 37

CONFIDENTIAL

Corporate Information Awareness Questionnaire

This survey is part of a review of the information storage and retrieval needs of organisations. In the organisation in which you work, we are interested to find out what types of information you think are of strategic importance. Also we are trying out a number of different ways to approach this question, and hope you will bear with us in trying out a few different questionnaires. Please fill out the appropriate sections of these forms and return them to us (see address below). These responses will be kept confidential, and no individual respondent's data will be able to be identified in the summary, analyses and reporting of the findings. If you are unsure of any terms used here please refer to the covering letter or call the Principal Researcher Dr Colin Sharp on 015 790 030. Wherever there are boxes please only tick one of the appropriate choices. But if appropriate, please use the "comments" area to explain any variations you might expect to occur.

To put our analyses in context can we have some background on where you're coming from?

Confidential- OPTIONAL Of course you don't have to give us your name and address, etc. But it would help us to be able to follow up you for an interview. If you give us this information we'll make sure it is kept confidential, that comments are not traced to you, and the results are used as only for the research intended. Your Age: _____Gender: ¨ Male ¨ Female The organisation I was referring to is:_______________________________ The answers relate to my employed as: ¨ Manager of _______________________________________________ ¨ Customer/Marketing/Sales:__________________________________ ¨ Corporate/Computing/HR___________________________________ ¨ Other (please specify)______________________________________ I can be followed up for an interview: ¨ Yes ¨ No Name:_____________________________________; Phone: _______________________ Address: _________________________________________________________________

Corporate Memory 38

QUESTIONNAIRE 1 Strategic information is that information which might be relevant to management decisions affecting the strategic direction of the organisation (or major part of

the organisation) in the next year or more; such information could include informal advice or documents from clients, or from other organisations as well as from other staff in your organisation.

Step 1: we would like you to help us determine what YOU think are the TEN main elements of strategically important information involving your work. Please list the 10 elements down column 1. Step 2: then can you rank them from 1 to 10 where number one it the top most important element.

COLUMN 1: (step 1) Strategically Important Elements of Information FROM MY JOB (enter a few key words of your choice)

Rank (step 2)

Step 3: Please put notes here about the Main Reason For selecting this ELEMENT & its RANKING (enter a few key words of your choice)

Corporate Memory 39

QUESTIONNAIRE 2

Here we would like you to help us determine what are the common factors underlying the understanding of what is strategically important information. Please read down the elements listed in column 2. Step 4: we would like you to help us determine what YOU think of the TEN information elements listed in Column 2; Step 5: then can you rank them from 1 to 10 where number 1 is the top most important element, and 10 the least important. Step 6: now select another element from COLUMN 2 which is very similar to the current item (and put it in COLUMN 3); then select another that is very different (in COLUMN 4).

COLUMN 2: Elements of information

Rank COLUMN 3 Which Element is Very Similar to this Element (enter the letter or key words from Column 1)

COLUMN 4 Which Element is Very Different from this Element (enter the letter or key words from Column 1)

What is the Main Factor that is similar in COLUMNs 2 & 3 BUT DIFFERENT in 4 (enter a few key words of your choice)

A) Organisational culture in your organisation

B) Organisational culture in other organisations

C) Information on clients' service problems

D) Information on clients of other organisations

E) Organisational history and past management practices in other organisations

F) Organisational history and past management practices in your organisation

G) Personnel management history of specific staff problems

H) Information about my duties in the organisation and the competencies required for this work

I) Information about my profession and its competencies

J) Information about how and where data is stored

Corporate Memory 40

QUESTIONNAIRE 3: YOUR ELEMENTS (from Q2 Column 1) versus OUR ELEMENTS (From Q2 Column 2)

OUR ELEMENTS YOUR ELEMENTS (from COLUMN 1 in RANK order)

A: our culture

B: other culture

C: client's problems

D: other clients

E: other history

F: our history

G: personnel problems

H: my duties

I: profession

J storage

COMMENTS

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

Corporate Memory 41

QUESTIONNAIRE 4 In the following Table are some statements about types of information that may be available to you and you colleagues at work. Step 1: Please place an X in the box to the left of the statement in the column which is most indicative of your perception of the importance of types of information.

So if you thought a statement was most strategically important to your organisation you would mark (X) the box only in the 5th column for that statement; if it was least strategically important you would put the X only in the 1st column for that statement; if the statement was between these extremes then you could use the 2nd to 4th Columns; there would only be 1 X in the 1st and 5th columns across all statementd, but there would be more than one statement with columns 2 to 4 marked.

Step 2: Please use the column to the right of the statement to indicate with a K whether this type of information is (K) known or a U if it (U) unknown to you; Step 3: Please use the far right column to indicate with a G whether you think the information has been (G) gained or a L if it has been (L) lost in a recent change of

staffing. Strategic Importance Strategic Consequences

Least Import.

Next to

least

Neither most nor

least

Next to most

Most Import.

kNown / Unknown

Gained / Lost

COMMENTS

1 2 3 4 5 Scale value ¨ ¨ ¨ ¨ ¨ Organisational culture in your organisation

¨ ¨ ¨ ¨ ¨ Organisational culture in other organisations

¨ ¨ ¨ ¨ ¨ Information on clients' service problems

¨ ¨ ¨ ¨ ¨ Information on clients of other organisations

¨ ¨ ¨ ¨ ¨ Organisational history and past management practices in other organisations

¨ ¨ ¨ ¨ ¨ Organisational history and past management practices in your organisation

¨ ¨ ¨ ¨ ¨ Personnel management history of specific staff problems

Corporate Memory 42

¨ ¨ ¨ ¨ ¨ Information about my duties in the organisation and the competencies required for this work

¨ ¨ ¨ ¨ ¨ Information about my profession and its competencies

¨ ¨ ¨ ¨ ¨ Information about how and where data is stored

S.I.G.N.U.L. survey 43

Please turn to the NEXT page ...

ANY OTHER COMMENTS : Please provide any other comments about the issues raised, the questionnaire, or the process

involved in this survey.

Thank you for your assistance.

PLEASE RETURN to:

Dr. Colin Sharp Flinders Institute of Public Policy and Management

GPO Box 2100 Adelaide, SA, Australia, 5001 Fax: -61- 8 -8201 2273