Industrialization

The Three Pillars Of Industrialization via Knowledge Work Factory

These principles are ubiquitous, underutilized, and timelessly valuable:

Standardization. This exists at multiple levels. There’s the interchangeability aspect we’ve mentioned with the Bureau of Standards and all those nuts and bolts. But there are also reference standards (think of BluRay, Bluetooth, etc.). There are interoperability standards, such as communications for emergency workers and air traffic control. At a large insurer, by contrast, call center workers used no standards for recording the reasons for inbound calls. Of course, this caused chaos. But this chaos went unnoticed because that’s just business as usual in the world of knowledge work.

Specialization. Specialization applies equally to machines and workers—and that includes all workers, especially knowledge workers and their intangible tasks. The easiest way to think about it is to imagine the number and diversity of tasks performed by a worker or a machine. For handmade shoes, for example, a single cobbler might perform all or most of the tasks. As shoemaking is specialized, different machines might perform a single task, alongside workers doing the same. The fewer tasks performed by a single worker, the more productivity rises. And interestingly, the largest gains are often the first. When assembly lines were first introduced in manufacturing, it was not unusual to see a 50 percent increase in productivity on the very first day!28 Most people are surprised to learn that knowledge work, and mathematics in particular, was one of the first areas to adopt Smith’s doctrine and benefit from specialization. Around 15 years after publication of The Wealth of Nations, Gaspard de Prony was busy with a team of mathematicians developing a set of logarithmic tables for publication by the French government. Anxious to finish quickly and economically, he hired a wide range of mathematicians of varying skills and wage rates. He assigned the most skilled to oversee entire calculations while more economical, lower-skilled workers toiled with simpler, underlying math work. Four decades later, Charles Babbage cited this work specialization by Prony as helping to inspire his vision for the first mechanical computers, which he designed in the 1830s.29 And yet today, almost two centuries later, knowledge workers confidently continue to insist that their simplest tasks cannot be standardized and similarly specialized. And their management executives defer to this misperception.

Division of labor. Smith talked about the people drawing out wire to make pins. But the division of labor can be further subdivided: There’s . . . 1. Division of work. Think of the ancient Egyptians dividing work on the pyramids among skilled craftsmen, artisans, stonecutters, and porters. That’s the same way today’s general contractors and subcontractors divide work. Next there’s . . . 2. Division of job positions. Think of a factory where the work is divided by job—like a machine shop. Each machinist performs groups of activities and is responsible for the quality of the output. Even the cavemen’s flint-tool lines are examples; it’s really a workroom with craft or artisanal workers who design their own “bundles” of activities and methods (like knowledge workers today). And then there’s . . . 3. Division of work management. This is what can be called the “specialization of specialization.” It occurs when the design of production is removed from the workers and transferred to a “specializer.” In factories, the task of specializing labor became industrial engineering (i.e., a specialty). But knowledge workers, like the cavemen toolmakers above, generally retain the “decision rights” to design their own production methods. That’s because of . . . 4. Division of perception. This has not been widely adopted within businesses. The perception of what work can be feasibly standardized is still as uncontrolled and autonomous as a century ago, when the U.S. market was crowded with a million ax models. The same is true today: no one is taking inventory of countless one-off perceptions in the business. But just like Herbert Hoover, executives could mandate that the perception of knowledge work activities be standardized and documented. And then industrial engineers could go to work industrializing the million unnecessarily different ways that knowledge workers perform tasks as simple as chopping wood: reconciliation, reporting, reviewing, and more.