decentralization of knowledge work

Knowledge work has been slowly decentralizing for decades. But since COVID pandemic, it seems like just the past few years.

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Many knowledge organizations have been blindsided by the rapid decentralization of knowledge work. It is disrupting the usual manner of knowledge work as it has been done for decades: commuting daily to a centralized office location. That commute is no longer necessary. Knowledge work no longer requires the physical transportation of knowledge workers to an office building. Thanks to information and communications technology advances of the past five decades, the centralized, commute in office has become obsolete.

Knowledge organizations are struggling to adapt to this change. It’s been building since it was first predicted in the mid-1960s by futurist Arthur C. Clarke and as high speed highways began to exceed design capacity the following decade. But from the perspective of many knowledge organizations, it arrived with suddenness and surprise amid public health measures to contain the spread of the COVID-19 pandemic. That has left many knowledge organizations unprepared and facing future shock from too much change at once. This has led to negative consequences including:

  • Staff surveillance and “coffee badging;”
  • Lowered morale and engagement;
  • Loss of top performers and future leaders;
  • Negative social and news media accounts;
  • Difficulty planning staffing and space requirements.

The good news is knowledge organizations don’t have to navigate the shift alone. They can adapt and do so in a manner consistent with their values and mission and thrive in today’s decentralized, virtualized world of knowledge work.

Help is available.

Decentralized Knowledge Work: Transforming Organizational Management, Culture

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The evolution of information and communication technology over the past four decades has decentralized knowledge work. Unlike during the latter decades of the 20th century, knowledge industry organizations no longer require dedicated workplaces.

It began in the 1980s with the personal computer followed by portable computers and communications devices such as smartphones that have all but replaced the office desk phone. This digital world of knowledge work is replacing the analog high speed highways (no longer high speed due to exceeding design capacity) that physically connected knowledge workers to centralized commuter offices (CCOs). A large amount of knowledge work now gets done with texts, emails, video conferences that are independent of a CCO.

This shift occurred relatively swiftly and is transforming society and organizations. Knowledge organizations now must undergo a management, structural and cultural transformation to adapt. Some are struggling to do so and requiring staff to report to CCOs and incur the personal time and economic costs of commuting.

It’s generating conflict, attrition and degrading morale in these organizations. It’s also a maladaptive response to the transformation of how knowledge work is done. It is underpinned by outdated Theory X management philosophy and related cognitive biases.

Theory X is a management theory developed by Douglas McGregor. It is based on the assumptions that people don’t really want to work, lack ambition, only work to collect a paycheck, and need constant supervision. This theory is reinforced with how employment is defined, wherein an employer determines when, where and how work is performed.

Related cognitive biases include anchoring (knowledge work is done at one time and one place—the CCO— or it can’t truly be work). Another is the sunk cost fallacy that organizational resources invested in offices require they be used lest the value of those investments isn’t fully realized/recovered. Theory X is reinforced by the Industrial age, hierarchal command and control management structures topped by a powerful CEO. That accentuates the cognitive biases since they are held by a single leader above question.

In contrast to Theory X, McGregor’s Theory Y management model assumes that people want to work, want to take responsibility, and do not need much supervision. This lends itself to evaluating work based on outputs and a project and process versus people management approach. This organizing principle of knowledge work is described in a 2013 Harvard Business Review article by Roger L. Martin.

In today’s decentralized paradigm of knowledge work, knowledge workers need Theory Y leaders, not Theory X bosses. That means identifying strong team leaders respected by their colleagues, supporting high functioning teams and the team formation process, and following best project management principles and practices an inculcating them into the organization.

Those teams decide where and how often they meet in the same location or if they meet in person at all. The meetings serve an end – working on the project or social bonding – and not meeting for the sake of meeting. There may or may not be a dedicated workplace.

To navigate this rapidly changing environment of knowledge work, organizations must adapt and transform. Assistance is available. To schedule an initial consultation, email [email protected] or call 707-414-8179.

At its core, return to office debate about redefining knowledge work

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Personal computing and communication devices and the Internet have decentralized knowledge work and made the daily trip to centralized commuter offices (CCOs) obsolete. Knowledge workers discovered its irrelevance and enjoyed recovering personal time spent commuting during the public health social distancing measures in response to the COVID-19 pandemic.

Now as some organizations demand they return to the office (RTO) on a set number or designated days of the week, many are understandably rebelling.

But the real debate isn’t about showing up in person at the CCO on a prescribed number of specific weekdays. It’s about redefining knowledge work and specifically how it’s done and managed.

In his 2013 book 2013 eBook Four Dead Kings at Work: The Decentralization and Blending of Work in the 21st Century, author Dave Rolston predicted the imminent death of the four primary tenets or kings of knowledge work in the Industrial Age:

  1. Set job duties;
  2. Managed by a single manager;
  3. Performed at one place (the CCO);
  4. At the same time (8-5, Monday-Friday).

This definition worked well before 1990 when the tools for knowledge work were at the workplace and not portable like today’s personal devices, online databases, collaboration platforms and more recently, AI chatbots.

Now, organizations and knowledge workers must adjust to the post-Industrial Age environment. That entails determining when co-located work is beneficial and when it isn’t. It also requires assessing the communications culture.

When knowledge workers were regularly in the CCO, meetings — both scheduled and ad hoc — were frequent. Even too frequent for many knowledge workers. They express a real time, speaking-based communication culture.

To fully utilize today’s communication and collaboration tools, knowledge organizations must adopt a more written, asynchronous communication culture. They also must find the right balance between this and spoken communication and when knowledge workers must be assembled to discuss and sort through complex and difficult issues that benefit from synchronous, in person discussion. That is driven more by business needs to complete reports and projects and reach decisions rather than the daily calendar.

It’s also critical that knowledge organizations keep their missions clearly communicated to staff so they can see how their work makes a meaningful contribution as this article in today’s Wall Street Journal implies.

Leased/owned office space downsizing likely to accelerate

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Knowledge work is currently in an awkward transition out of centralized commuter offices (CCOs) and dispersed to home offices. Many organizations have adopted what’s referred to as “hybrid” arrangements with staff working in the CCO a set number of scheduled days, typically two or three days a week. For knowledge workers, the hybrid arrangement is disruptive. The vast majority need only one workspace as shown during the COVID-19 public health measures.

A home office is that location. It provides convenient access to food and coffee that fuel knowledge work, particularly given many if not most CCOs lack on site cafeterias. In addition, workspaces are customized to knowledge workers’ preferred equipment and ergonomics. Some, for example, may prefer sit/stand desks or kneeling chairs that aren’t present in both home offices and CCOs. Finally, their most portable knowledge work tool – the brain – does not require multiple locations in order to function effectively.

The homes of some knowledge workers don’t offer a good office setting. They may not have a suitable space for a home office setup or other circumstances that make it impractical as a regular workplace. These staff need and prefer the CCO to get their work done. But they are a small minority and don’t justify the amount of office space organizations must finance. They can get by with only a fraction of their current owned and leased space and considerably reduce operating expense.

Organizational management is recognizing the trend and potential sizable cost savings and rightsizing their office space footprints accordingly. Expect this to accelerate over the next few years.

Pandemic rapidly accelerated virtualization, decentralization of knowledge work

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The viral pandemic that closed down centralized commuter offices (CCOs) in the first quarter of this year accelerated a trend toward working outside of the CCO. The trend had been slowly growing in the previous decade or so, allowing knowledge workers to work in their residential communities during some or all of the work week.

The pandemic and the lockdowns instituted by state and local governments demonstrated to knowledge organizations that they could conduct their business without a CCO. Prior to the pandemic, the question was to what extent could their staffs work outside of the CCO and specifically how many days of the work week and which days. That forced organizations to adapt in how they communicate and collaborate, make decisions and coordinate and complete project using digital information and communications technology as the medium for those fundamental activities of knowledge work, replacing the analog mode of the cube farm.

Freed of the time sucking and often stressful daily commute to the CCO, knowledge workers have seen the quality of their lives improve, having more time for exercise, sleep, home cooked meals and family. For knowledge organizations, now that they’ve seen they can function without a CCO as their workplaces, they are beginning to address the larger question of the future role of their offices.

The issue is shifting from teleworking to virtualization. Organizations that were already partially virtual at the start of the pandemic with staff working only part of the week in the CCO and then shifting to the full work week with the pandemic are now examining whether to go fully virtual and dispense with the CCO altogether.

Others that were less further along on the trend line at the start of the year with staff only occasionally teleworking outside of the CCO are considering expanding telework while retaining the CCO. As they expand teleworking and their cultures and management practices adjust, over time these organizations could also begin to question whether it makes sense for them to virtualize and begin to migrate out of the CCO, realizing significant cost savings.

Confronting a large budget deficit ahead of the start of the fiscal year that began July 1, California Gov. Gavin Newsom called out the potential savings in his proposed fiscal year 2020-21 budget:

Historically, state government has been slow to adopt modernizations in the workplace. But the COVID-19 pandemic has forced a massive experiment in telework and allowed state managers, led by the Government Operations Agency, to rethink business processes.

This transformation will allow for expanded long-term telework strategies, increased modernization and delivery of government services online, reconfigured office space, reduced leased space, and when possible, flexible work schedules for employees.

The virtualization and consequent decentralization of knowledge work out of CCOs will have major implications in the decades following the 2020 viral pandemic that will reshape modern economies relative to labor markets, land use and real estate and transportation.

Metro areas developed like solar systems with CCOs as the stars at their centers with housing development and transportation systems orbiting around them. Their gravitational influence was weakening before 2020, diminished by information and communications technology that made them less relevant. Information and communications technology became the medium of knowledge work, allowing information to be processed and communicated virtually anywhere. No longer is it necessary to move the knowledge worker daily in motor vehicles to a set location during fixed time frames to accomplish that.

The pandemic hit like a huge gravitational wave, rippling through metro area “solar systems,” disrupting the gravitational tug of the CCO and scattering knowledge workers onto their own trajectories. Knowledge workers residing in the outer exurban regions of their solar systems were suddenly freed of the long super commute daily orbit to the solar center and back home again.

Some knowledge workers and their organizations realize than can exist in other “solar systems” — less densely populated smaller metros and towns free of commute congestion and where the pace of life is slower and the cost of living lower.

Looking back, the 2020 viral pandemic will be seen as a major event providing a tremendous boost for the rapid reformation of modern society.

Silicon Valley renders itself obsolete

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Out of habit, inertia, or just a plain fear of change, many white-collar workplaces have avoided allowing employees to regularly work from home — but that may soon change. Plenty of so-called knowledge workers are finding that they can comfortably do their job from just about anywhere they have a wifi connection and their laptop. Large majorities of workers in the consulting & research (85%), insurance (84%), advertising and marketing (73%), finance and financial services (70%), legal (68%) industries have been doing their jobs remotely as a result of the coronavirus outbreak, according to the NBC|SurveyMonkey data. Among these same workers, most report wanting to either work from home all the time even when it is safe to return to the office, or at least wanting to work from home more often than previously.

Source: How Silicon Valley work-from-home ‘forever’ will hit every worker

Silicon Valley as a centralized work location has essentially rendered itself obsolete. In its early days, it was all about location. It had fertile mix of engineering talent, proximity to Stanford University and the larger San Francisco Bay Area as well as plenty of space for microchip and computer manufacturing plants run by household names such as Intel, Hewlett Packard and Apple Computer.

People and place combined to make Silicon Valley what it is. Or was. Now the world changing information and communications technologies it innovated as this article points out allow knowledge work to be done most anywhere, regardless of location. Even Silicon Valley.

And not a moment too soon as high housing costs and long commutes over congested freeways have made it a less desirable place to work. But Silicon Valley certainly deserves kudos. Its products have helped shrink the time and distance burden of daily commuting, benefiting knowledge workers wherever they make their homes.

Knowledge economy should evolve beyond Industrial Age Ver. 2.0

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As much of the economy becomes more knowledge-based it continues to retain a key feature of the Industrial Age: geographic concentration in urban centers. That’s according to this piece recently appearing in Governing. Instead of a post-industrial economy, the economy is being rebooted as Industrial Age 2.0. As in ver. 1.0, work is centralized. Or clustered or agglomerated as it’s termed in the article. Less so in manufacturing plants but in office towers and sprawling info tech industry campuses requiring knowledge workers to show up there every workday just as in the industrial economy.

But that has distorted housing markets, driving up home prices and making nearby housing unaffordable for many. That in turn is expanding the geography of metro areas as knowledge workers seek more affordable housing in communities distant from the office towers and tech campuses in their centers. That drives a level of commuting to work metro areas’ 20th century transportation systems were not designed to handle, creating congested and unbearable “super commutes” that suck hours from each work day. Clustering and the agglomeration run up against fundamental limits. There is only so much residential real estate for knowledge workers to live on adjacent to the office towers and campuses. The law of supply and demand dictates only a limited amount will be affordable.

Analysts such as those cited in the Governing article contend the holy grail of the knowledge economy is the same as that of the offices and assembly lines of industrial economy: proximity. “You wouldn’t actually get the innovation if you took the people working on those things and spread them around the country,” Salim Furth, director of the Urbanity project at the Mercatus Center at George Mason University, told the publication. “We rely on face-to-face contact to come up with great innovation and changes.” Buy does that hold true most the time for most knowledge workers? Likely not. Knowledge work is both an individual and collaborative effort. And not all collaboration nor even the most productive must occur in same physical location. Lots of it can be done virtually using today’s information and communications technology.

The knowledge economy should evolve beyond Industrial Age Ver. 2.0 amid rising concern over the environmental impact of commute transportation demand, housing affordability and declining population health status (long commutes have a deleterious impact).

Self-driving cars. Scooters. The future of commuting to work is here

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From crowdsourced shuttle buses to companies offering rides to lure top talent, here are concepts used in some cities that could one day help your morning commute.

Source: Self-driving cars. Scooters. The future of commuting to work is here

This is applying state of the art technology to the Industrial Age practice of transporting knowledge workers to offices rather than utilizing information and communications technologies of the Information Age to decentralize knowledge work, bringing it to communities where people live.

It may look like progress. But in fact it’s regressive and reflects a 1950s mindset wherein knowledge work can only be performed in centralized, commute in offices. It does little to relieve the daily time suck of the commute. It’s time to put the Industrial Age in the past and truly evolve.

Michael Shear’s Rx for the increasingly congested commute and improved access to knowledge jobs

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The biggest challenges facing metro regions are transportation and traffic congestion, accessible well-paying employment opportunities and affordable housing. In the world of knowledge organizations, a closely related challenge is determining to what extent staff members will work in the centralized, commute-in office and which are “remote” workers who perform their job duties outside of the office, typically working from home.

Michael Shear of Strategic Office Networks LLC has a solution that addresses all of these for knowledge organizations and regional transportation planners: transitioning away from the centralized, commute-in office of the Industrial Age economy to a more decentralized structure that utilizes today’s advanced information and communications technologies (ICT) to bring the work to communities where knowledge workers live. Those technologies link Enterprise Centers® that serve as community-based workplaces for as little as a few dozen to several hundred employees working for major employers located throughout a metropolitan or regional area. These centers are the building blocks of what Shear terms Distributed Metropolitan Design®.

I interviewed Shear for the Last Rush Hour podcast in December 2015. Listen here.

Key to Shear’s concept is reframing how we think about transportation. With today’s robust ICT capabilities that make it possible to work from most anywhere and traffic congestion crippling many metro areas, the issue is no longer how to most efficiently transport knowledge workers to centralized commuter offices. It’s now about access to a workplace that meets the needs of both the worker and the employer organization.

Traditional transportation initiatives encourage commuters to use public transportation or carpool in specially designated highway lanes. Transportation planners plan more expressway lanes to accommodate the continued growth in commute transportation demand. That remedy has hit the wall as metro areas continue to struggle with commute congestion, particularly as knowledge workers are forced to select housing far from their offices that they can afford, adding to commute transportation demand. Meanwhile, highly compensated workers bid up the cost of housing in central metro areas, fostering a severe housing affordability crisis such as currently afflicting California.

Shear’s concept recognizes that organizations have substantial investments in existing office space. They often can’t quickly transition to an office-less virtual organization. Nor are many workers ready or able to work from a home office or wherever else they choose. Much of this reality drives the debate over the pros and cons of “remote” work and “telework.” With a distributed organizational structure, these terms become far less relevant. When staff need to be co-located for team meetings and project sprints requiring intense collaboration that can be accomplished in settings outside of dedicated central offices. Shear also argues that the most prevalent form of “casual” telework — where only some knowledge workers work from home a day or two per week or more infrequently — cannot make a significant impact on transportation demand and metro area congestion.

A primary challenge for Shear’s concept is determining the right size for the Enterprise Centers®. They provide supported office space in residential communities and must be sensitive to the character of those communities. They must be large enough to be economically efficient but can’t grow too large because they will then generate substantial commute trips from non-locals and objections from nearby residents, effectively becoming the big commute-in cube farms and sprawling parking lots they would replace. Their size would likely be a function of the housing density of the neighborhoods in which they are located. Larger facilities would serve higher density areas where knowledge workers live within walking or bicycling distance with smaller ones most suited to lower density neighborhoods and reached by those modes of transportation or short trips by automobile or public transportation.

Why Do We Still Commute? – Pacific Standard

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Over the last year, many companies have ended their liberal work-from-home policies. Firms like IBM, Honeywell, and Aetna joined a long list of others that have deemed it more profitable to force employees to commute to the city and work in a central office than give them the flexibility to work where they want. It wasn’t supposed to be this way—at least according to Norman Macrae.

Macrae foretold the exact path and timeline that computers would take over the business world and then become a fixture of every American home. But he didn’t stop there. The spread of this machine, he argued, would fundamentally change the economics of how most of us work. Once workers could communicate with their colleagues through instant messages and video chat, he reasoned, there would be little coherent purpose to trudge long distances to work side by side in centrally located office spaces. As companies recognized how much cheaper remote employees would be, the computer would, in effect, kill the office—and with that our whole way of living would change.

Source: Why Do We Still Commute? – Pacific Standard

As readers of this blog know, I am firmly in Macrae’s camp. I have a couple of issues with this analysis by Greg Rosalsky. It contains the implicit assumption that knowledge workers commute in order to have real time, face to face conversations with their colleagues every Monday through Friday. The value of these co-located daily discussions is cited to justify the daily commute.

That might hold true for those working in intense think tank work environments like Google’s Moonshot Factory where the job is a group exercise of spitballing and deeply analyzing concepts for their practicality and most importantly, their potential monetization. That’s more akin to a live-in academic residential fellowship than the usual type of work most knowledge workers perform with most of its components and deliverables in digital form accessible from most anywhere. In fact, many of them find they are more able to think and concentrate outside of centralized, commute-in office spaces such as in quiet home offices and communicate quite easily with colleagues using online collaboration tools.

Rosalsky’s article also repeats the “urban centers are cool and people want to live there” to partly explain why we continue to commute to centralized offices in metro areas. But as Rosalsky also notes, the cost of living there is quite high. It’s often out of reach for all but the highest paid knowledge workers and is itself a factor driving lengthening commutes to distant locales where housing is affordable.

To Rosalsky’s credit, he does mention the personal costs of commuting borne by knowledge workers — and indirectly by their organizations due to the adverse health and wellness impacts of daily commuting. I would argue that the maturation and proliferation of information and communications technology has brought us to the point predicted by Macrae where for the vast majority of knowledge workers, the costs of daily commuting can no longer be justified nor the expense of maintaining centralized, commute-in office space for their organizations.