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Communication & Knowledge Networks in 21 st century Organizations. Professor Noshir Contractor University of Illinois at Urbana-Champaign http :// 2000 Educational AICVB Conference Unconventional Wisdom: Thinking Beyond the Boundaries August 10, 2000.

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Communication & Knowledge Networks in 21st century Organizations

Professor Noshir ContractorUniversity of Illinois at Urbana-Champaign

2000 Educational AICVB Conference

Unconventional Wisdom:

Thinking Beyond the Boundaries

August 10, 2000

thinking beyond boundaries
Thinking Beyond Boundaries
  • It starts with what we call unconventional wisdom. That means looking at established problems in new ways. And anticipating the opportunities and challenges that lie ahead. After all, our profession is evolving very rapidly. Shouldn’t your thinking EVOLVE with it?
  • Adoption based on relative advantage, observability, adaptability, compatibility, trialability
  • Examples: Automobiles, Telephone, Videoconferencing, Arpanet/Internet, WWW
substitution effects
Substitution Effects
  • U.S. Conference Board estimates National secretarial pool has shrunk by more than half a million in the past decade

Substitution Effects ?

  • Computer-mediated versus computer augmented communication?
  • Intranet as a publishing versus communication environment?
    • Blurring the genre of the memo and the genre of the dialog
evolution of technology use8
Evolution of Technology Use



  • If the automobile were invented in 1970 and dropped in price accordingly, while increasing features, a car would cost less than $5 and drive 25,000 miles/gallon (Economist, 1998)
  • To which the president of GM replied: "Yes, but would you want your car to crash every time you tried to open a window?"
time to reach a quarter of the us population newsweek 4 13 98
Time to reach a quarter of the US population (Newsweek, 4/13/98)
  • 1926/TV: 26 years
  • 1953/Microwave: 30 years
  • 1975/PC: 16 years
  • 1983/Mobile phone: 13 years
  • 1991/Web: 7 years
  • 1873, Electricity: 46 yrs.
  • 1876/Telephone: 35 yrs.
  • 1886/Automobile: 55 yrs.
  • 1906/Radio: 22 yrs.
  • 1996: Total volume of email greater than snail mail; total sales of PC greater than TV sets
  • 1999: Total volume of data traffic greater than voice; 10 fold increase in U.S. e-commerce in 10 months
  • Moore’s Law: Computational power doubles every 18 months
  • Metcalfe’s Law: The value of a network is proportional to the number of users squared
  • Current 32 bit IP addresses can accommodate 4295 million devices (2exp32)
  • The new proposed 132 bit IP address scheme can accommodate (3.4e38 or 340 undecillion) devices
  • Finland provides an early preview with WAP IT and Bluetooth
  • Telecommuting grew from 4 million in 1990 to 11 million in 1997 (Telecommute America)
  • E-commerce in Europe will account for $19 billion in 1999 and is expected to rise to $223 billion in 2002 (IDC, June, 1999)
enlargement effects
Enlargement effects?
  • At current growth rates WWW would surpass the 29 Terra bytes of the Library of Congress by 1998 (Wired, May 1996). But ...

WWW is a library with all the books on the floor, and

WWW is a World Wide Wait

enlargement email delays
Enlargement: Email delays
  • 12% of email takes over 5 minutes to be delivered and 10% is delivered over an hour later (Source: Inverse Network Technology, a Santa Clara company that tests Internet performance) - Wall Street Journal 5/29/97.
  • Internet drop out rate 11 percent (Jim Katz, ATT labs, 1996)
enlargement effects16
Enlargement effects?
  • “Shadow costs” of media transformation between “Information spigots”
    • Electronic: phone, mobile, PDA, PC, printer, copier, fax ...
    • “Dead tree” editions: Memos, reports, books, newspapers, periodicals ...
enlargement network failures
Enlargement: Network Failures
  • Gigalapse: A billion lost user hours during a network failure predicted by Bob Metcalfe for 1996 - did not materialize
  • Closest was AOL's 6.2 million people for 19 hours = 118 megalapse.
  • Telephones experience 30,000 people without 5 hrs. service per day = 150 kilolapse
enlargement information gap
Enlargement: Information Gap
  • Emerging technologies improve the amount of information among the “haves” and the “have-nots”
  • But the “haves” are much better informed than the “have-nots” resulting in an increase in the Information Gap
enlargement digital divide
Enlargement & Digital Divide
  • User end: Digital Bristol experience
    • 87% of users at public kiosk were those who had PCs at home
  • Server end: 80% of users go to about 0.5% of the web sites (about 15,000 cites)…. And 70% of these are commercial web sites (Source:
  • How do we move from the Digital Divide to a Digital Dividend?

Productivity Paradox

  • Productivity Paradox: In 1996 US companies spent 43% of their capital budgets on computer hardware - a colossal $213 billion, and more than they invested in factories, vehicles, or any kind of durable equipment. In 1981 expenditure on computer hardware had been just 6 %.
  • Adding in all the associated costs, the total cost of computing for 1996 was about $500 billion in the US and more than $1 trillion worldwide.
  • Yet since the mid-sixties, productivity gains have stayed below 2%.
productivity paradox why
Productivity Paradox: Why?

Giving pony express riders

cell phones to call ahead to ask

for water (Neuman, 1997)

evolution of technology use23
Evolution of Technology Use




work by bid
  • Thinking beyond the boundaries ….

Transaction costs of coordination mechanisms

  • Hierarchies (Low)
  • Markets (Medium)
  • Networks (High)
organizational forms
Organizational Forms




fedex and cookies
Fedex and cookies

Firm A

Firm B

Corporate level

Business unit level

Group level

Individual level

Interdependencies in the virtual organization can occur both

internally and externally and at various levels of the firm.


Surge of Network Organizations

  • More than 20,000 alliances formed worldwide in 1996-98, accounting for 21% of the revenue of America’s 1000 largest firms in 1997 (Harbison & Pekar, 1999)
  • Is the “firewall” separating the Intranet from the Extranet the last vestige of organizational boundaries?
reconfiguration examples i workplace demographics
Reconfiguration: Examples IWorkplace demographics
  • More than half of the European work force does not go to an office for a 9 to 5 job (Charles Handy)
  • Manpower had 2 million employees in 1997
  • 25 years ago 1 in 5 worked for a Fortune 500, now less than 1 in 10 does

Reconfiguration: Examples

  •, Put your money where your mouse is. Lowest price for me.
  •, Lowest price for us
  • Auction. Highest price for me.
reconfiguring digital cities
Reconfiguring Digital Cities
  • The Hong Kong lesson
  • Digital Kyoto
  • Digital Venice
reconfiguring relationships e lancers
Reconfiguring relationships:E-lancers
  • The fundamental unit of such an economy is not the corporation but the individual. Electronically connected free lances or e-lancers join together into fluid and temporary nets to provide and sell goods and services (Malone, Harvard Business Review, 1998).
reconfiguring relationships brokering information
Reconfiguring relationships:Brokering information
  • When administration becomes …… amnesia-stration
  • Info-mediaries (John Hagel & Marc Siegel)
  • Importance of leveraging knowledge capital via social capital - The case of the Lovegety
  • From groupware to communityware. Is it the next killer app or a …..???

1. Turn on the power and set the MODE button you want with MODE button. You can confirm the MODE you chose as the red indicator blinks.

  • 2. Lamp blinks when (someone with) a Lovegety for the opposite sex to yours set under the same MODE as yours comes near.
  • 3. FIND lamp blinks when (someone with) a Lovegety for the opposite sex to yours set under some different mode from yours come near. In that case, you may try the other MODES to “GET” tuned with (him/her) if you like.
who knows
Who knows ….
  • Social Structures are based on “who knows who.”
  • Cognitive Social Structures are based on “who knows who knows who.”
  • Knowledge Networks are based on “Who knows what.”
  • Cognitive Knowledge Networks are based on “who knows who knows what.”
data used in iknow
Data Used in IKNOW
  • Based on organizational members’ Web pages:
    • Links between Web pages
    • Common external links from Web pages
    • Content on the Web pages
data used in iknow cont d
Data Used in IKNOW (cont’d)
  • Based on organizational members volunteering information about social and knowledge resources
    • Content: inventory of skills, expertise, etc.
    • Links: inventory of social networks
    • Incentives for volunteering information tied to performance appraisal and evaluation of help provided.
so why would one want to use iknow
So why would one want to use IKNOW?
  • Makes the virtual visible.
  • Adds social capital to knowledge capital by adding contacts to content.
  • While collaboration tools help improve the process of collaboration in knowledge networks … IKNOW helps one effectively identify collaboration partners and grow the knowledge network.
iknow test beds
IKNOW Test Beds
  • National Computational Science Alliance
  • PrairieNet
  • Center for Collaborative Manufacturing
  • USAID Global Information Systems
  • U.S. Army Public Works Department
  • Summer Workshops and Institutes
  • Virtual courses
  • IKNOW-IT Illinois Tourism

Kawakami, Kenji (1995). 101 un-useless Japanese inventions. New York: W. W. Norton & Company.

… inventions that seem like they’re going to make life a lot easier, but don’t.

… gadgets that promise to give us something, and it is only later that we realize that their gift is undone by that which they take away

additional information
Additional Information

Program URL:

Email for questions and suggestions: