Knowledge Is Not Enough, It Must Be Applied

By R. Keith Mobley, Principal SME, Life Cycle Engineering

When it comes to data in the business world, there seem to be two extremes. Some organizations are data poor and others have so much data that it becomes impossible to use. Both extremes invariably fail to recognize the critical importance of the knowledge gleaned from timely, accurate data. Once converted into knowledge, it supports actions that drive business strategy, day-to-day activities and continuous improvement.

I must confess my inability to understand why or how intelligent people, especially corporate executives, prefer to make decisions based on intuition, the collective opinions of their leadership team, or the guidance from their board of directors instead of accurate data that defines the true situation. To me it is obvious that the only viable means of decision-making is to rely on knowledge about past performance, current performance, internal and external influences on future performance, and other factors that directly or indirectly define the future. Yet almost every day, large and small organizations ignore the data and forgo real knowledge when making decisions that determine their future. In too many cases, these decisions foreshadow the organization’s failure.

Examples of these failures are common. For example, a large integrated steel mill purchased six new zinc-plating lines at a cost of $500 million on the belief they were fully utilizing their installed capacity. They ignored the data that clearly showed that they were using less than 46%. Failure to understand utilization of installed capacity seems to be a problem shared by far too many organizations. Some plants artificially limit capacity by either limiting production hours or setting targets that are less than design capacity. Both may be the right business decision, but business leaders must understand that these are artificial limitations and reversible when needed. In a recent example, a high-speed manufacturing organization perceived the need to increase output. Since the current mode of operation was five-day, 24 hours, their first thought was to increase to a seven-day operation. When they looked more closely at the current operation, they found that current production targets were well below design capacity. With this knowledge, they increased output by 40% without incurring any additional cost or changing current operating hours. They simply raised the production targets.
Even after almost five decades, I cannot tell you the why, but we can provide the how to gain the knowledge and convert your organization into a knowledge-based operation. The journey starts with collecting accurate, timely data to drive knowledge and ultimately provoke action. While this sounds simple, it is perhaps the most difficult step in the journey. Data must be limited to the fewest possible key performance indicators. Collecting too much data creates data diarrhea and because of the sheer quantity, assures no one will use it. Use care to assure complete, accurate data. Data, especially cost data, is often badly fragmented and easily distorted. Bad data has no value, so make sure you are measuring the right indicators and that it is accurate.

Even when reduced to minimum key performance indicators, the amount of data needed to create a knowledge-based organization is substantial. Few organizations can afford to allocate a dedicated staff to collect and manage data. As a result, when these duties are assigned to already busy employees, they rarely get done. The solution is to automate the data acquisition and management. With today’s technology, we can automate most of this work, thus eliminating the overloads and collecting data that are more accurate.

The next step in the journey from ignorance to knowledge is converting acquired data into knowledge. Unfortunately, automation does not apply in this step. While automating data manipulation such as trends and charts can help, converting data into knowledge requires human intervention. The question is who should perform this role. Ideally, reliability engineers trained in statistical and business analysis provide the skills for this conversion. Unfortunately too few organizations have a viable reliability engineering function. This step in the process requires a unique skill set and dedicated time to complete, so assigning it to an already overloaded employee is not a good idea. The result from this part-time approach is rarely accurate or representative of the real situation.

Assuming we have effectively acquired meaningful data and converted it into actionable knowledge, one critical step remains. Knowledge has no value until it is used. I started this letter with this thought but it bears repeating. Think for a minute. How many examples can you cite where you or your organization failed to act on knowledge—knowledge of deficiencies, of situations, of people—that limited performance or created cultural issues? Perhaps it is production targets that are too low or a manager who fails to provide the leadership needed to meet business objectives. Let me leave you with one last question. Why do you ignore the problem? You know it exists. You have the knowledge. Always remember, knowledge is not enough. It has no value until you use it.

“Knowledge is Not Enough. It Must Be Applied."

Thank you for taking the time to read this month’s letter. Hopefully, it has raised a few thoughts that will help you take the next step in your journey to excellence. I welcome your feedback and am happy to respond to specific questions. You can reach me at [email protected].

Best regards,
R. Keith Mobley
Principal, Life Cycle Engineering, Inc.

Keith Mobley has earned an international reputation as one of the premier consultants in the fields of plant performance optimization, reliability engineering, predictive maintenance, and effective management. He has more than 35 years of direct experience in corporate management, process design and troubleshooting. For the past 16 years, he has helped hundreds of clients worldwide achieve and sustain world-class performance. Keith can be reached at [email protected].

© Life Cycle Engineering, Inc.

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