Nucor Steel vs. Partners HealthCare

The power of knowledge is often revealed in specific contexts. In a manufacturing setting where operational excellence is top priority, knowledge creation, sharing and application is a natural part of daily operation. Nucor Steel management and workers are proud of their products as a result of relentlessly pursuing zero-defect work outcome. Knowledge management practices are enthusiastically embraced because every body's compensation is determined by their work quality and productivity. For example, maximizing knowledge sharing is usually difficult if left to voluntary participation and no explicit incentive is provided. At Nucor Steel, however, it is a norm because only half of the bonus is based on individual performance, another half comes from group performance. To me, this is a smart design for it ties self interest and common interest together.

The daily operations of Partners HealthCare do not involve team work as thoroughly as those of Nucor Steel. Order entry, lab test ordering and online referral, for examples, mostly are decisions of individual physicians. The highly specialized nature of the knowledge required to achieve high accuracy and cost efficiency means the expertise of domain experts not only valuable but also scarce. But linking the domain experts' expertise to every physician's daily work, Partners HealtCare gets to improve its overall performance, in terms of better health care service and reduced operational cost.

At Nucor Steel, knowledge management primarily centers around people and management. Partners HealthCare, however, bakes knowledge into automatic systems. The people-orientation vs. system-orientation continuum provides a useful framework to analyze knowledge management implementation in the real world. Which approach is the best for the organizations looking for wisdom to enhance the possibility of success? The answer depends to a great degree on the nature of the settings.