This document summarizes research on effectively managing knowledge workers. It discusses how the workforce has shifted to a knowledge-based economy, making knowledge workers more important. While past management theories focused on physical labor, knowledge workers require more flexibility and autonomy. The document reviews several studies on identifying factors that influence knowledge worker productivity and satisfaction. It concludes that there is no single solution, and managers must adapt their style to each situation and empower knowledge workers by involving them in decisions.

1. Effective Management of Knowledge Workers:
The rules have changed
Written by Marie-Eve Fortin
Collaborators: François Castonguay, Doumit Junior, Grace Yu, Jason Barba
Concordia University – John Molson School of Business
April 1st
2015
Managing teams in the 21st century is not a walk in the park. With countless theories about how
managers ought to lead, and immense changes brought on by the information age, the task is
confusing at best. Worse—in attempting to portray the seamless image conventional
management ideals would dictate, energy is wasted on appearances while workers are not getting
what they need to thrive. Even with all the research which eventually formed seemingly winning
solutions for last century’s industrial economy, these are less and less effective for today’s
workforce. This is because managing a team in today’s knowledge economy cannot fit within
fixed rules, it must be consistently questioned and adapted in order for businesses to capitalize on
their most valuable resource; the knowledge worker.
Shift to knowledge-economy
One of the key characteristics of the 21st
century is what experts and academics alike call the
knowledge, or creative economy (Meyer, 2014; Dahlman & Aubert, 2001). The term was coined
to describe the apparent shift from an economy where manual labour dominated the workforce to
a more creative, ideas-driven industry (Meyer, 2014). With this shift came significant changes in
the workforce and even greater opportunities for success. Fully understanding how to effectively
utilise knowledge would allow businesses to achieve immense advancements necessary to
compete on a global scale. It is now of utmost importance for organizations to prioritize learning
how to gain the most from their human resources.
The first thoughts about the importance of knowledge work came from Peter Drucker over half a
century ago (Davenport, Thomas, Cantrell, 2002). Jack Welch, GE’s former chairman, noted that
Drucker was “the greatest management thinker of the last century” (Byrne & Gerdes, 2005, ¶ 5),
as it was his words which greatly influenced the ideas that brought General Electric great success
(Byrne & Gerdes, 2005). Academics, however, rejected his ideas, stating it lacked quantitative
evidence. Although to this day, it is hard to find any management principles that aren’t derived in

2. some way by the ideas of Drucker, an irony that satisfies our need for evidence for the credibility
of those who hail him as a management guru.
In the 1970s, decades before knowledge work took first place over the labour intensive economy
of the 20th century, Drucker noted the contributions and importance of knowledge workers,
predicting the challenges and opportunities ahead (Byrne & Gerdes, 2005). By the time the
labour economy changed to a knowledge-based economy, Drucker felt there was too little
advancement in our understanding of how to manage the new workforce, and threw a challenge
in a desperate attempt to encourage his peers to undertake the studies necessary to do more than
simply scratch the surface (Davenport et al., 2002). Davenport et al. (2002) suggests that doing
this is a major concern for the operational sustainability and growth of today’s businesses. He
states that “if companies can enhance knowledge worker productivity in this century anywhere
near as much as they did with manual labour over the course of the last one (an increase of
roughly 50 times), the payoffs will be astronomical” (Davenport et al., 2002, Introduction
section, ¶ 2).
Unfortunately, the importance of Drucker’s concerns resonate even more valid when considering
Handy’s (1995) theory on the Sigmoid Curve: Everything in life has a beginning and an end, and
to remain successful change is necessary. However, Handy (1995) argues that by allowing ups to
turn to downs, the process of reinventing oneself becomes increasingly difficult because you will
have much less time, resources and energy to undertake the necessary challenge of staying
relevant. Drucker’s warning fell on deaf ears for decades, and now that previous management
practices are no longer relevant, we have delayed, if not missed, a huge opportunity in harnessing
the potential of our knowledge workers, and it is now critical for us to address our lack of
knowledge if we are to compete successfully on a global scale.
Adapting to enable success
Today businesses struggle to find the right formula to fit this new environment, drawing from
thousands of management theories that worked well under the old structure—highly effective to
optimize physical processes, but inefficient with human capital. With this complex resource there
is no single or fixed solution, instead managers must use intuition to adapt to each situation and
adjust their management style accordingly.

3. Thomas H. Davenport, Robert J. Thomas and Susan Cantrell, collaborated through the Accenture
Institute for Strategic Change, in response to Drucker’s plea. Together they conducted an
extensive study including over 100 interviews with managers, workers and academics; across 41
different organisations, where detailed case studies were written while experimenting with all the
possible workplace design solutions they had conceived. They then organized a two-day
conference with approximately 30 peers to explore the topic further, and a pilot project to test
their theories. This comprehensive research narrowed down the main factors of knowledge
worker productivity, and composed recommendations to help managers determine adapted
solutions. However, they have concluded that there is not one universal solution, but rather a
series of possibilities depending on each situation. Furthermore, even if a manager found a
‘winning solution’ for his team, its relevance will eventually fade (Davenport et al., 2002).
Despite this vague outcome, two important points were discovered: There are significant
differences between high and low-end knowledge workers, and providing an appropriate level of
choice has a significant effect on worker satisfaction (Davenport et al., 2002).
According to Tannenbaum & Schmidt (1973); in order for managers to lead successfully they
must both assess the situation’s needs with insight, and using flexibility; adapt their behavior and
leadership style according to their conclusions. Similarly, modern managers must learn to adapt
their approach using a range of styles, depending on what is best suited for each situation. To test
the theories of this paper we interviewed an additional 11 knowledge workers and managers both
from Canada and China, and from a wide variety of fields. A subgroup of 6 from the IT field
were selected to help with deciphering similarities and differences within one field, and help
further test Davenport et al.’s ideas. The remaining 5 interviewees, in order to be as
representative as possible, vary from highly subjective to highly technical work: 1 creative
producer in entertainment, 1 crisis manager in aviation, 1 health practitioner, 1 finance manager,
and 1 engineering specialist. According to Davenport et al. (2002) the higher on the knowledge
spectrum, the more freedom and choice will play a positive role on motivation, justifying further
investment. It is important to make a distinction in order to better satisfy their needs (Davenport
et al., 2002). We determined the knowledge level of our interviewees by asking about the level
of creativity required in their work versus routine work—the more creativity is required, the
higher they are on the spectrum. We identified two high-end knowledge workers: a subject
matter expert in aviation, and a software developer. Similarities that were prominent were their

4. need for freedom, preference for an adaptive management style, and the ranking of stimulating
and challenging work as their number one motivator. Furthermore, the first is very satisfied with
his manager; the latter isn’t since the level of freedom and choice is not at the right level. Low-
end knowledge workers, however, vary much more in their preferences: two thirds prefer an
adaptive management style, while others preferred a democratic style. Also, while half felt most
motivated by good working conditions, one third felt motivated by appreciation and only one
sixth by challenging and stimulating work. Also, while some had less freedom and choice, it did
not affect their motivation or satisfaction. Like Davenport et al.’s (2002) conclusions our small
sample showed many differences, and highlighted how needs may differ by level. Tannenbaum
& Schmidt’s theory about management, reinforced through these studies, lends authority to our
observations that knowledge workers perform better when the management style used is adapted
to each situation.
Challenging preconceived notions
The shift to a knowledge-economy has changed the rules for management; leaders must stop
trying to be everything to everyone, and must instead challenge these preconceptions and re-
focus their efforts. The speed at which businesses have to operate within the digital age puts
more pressure on leaders today than it has in the past (Ancona, Malone, Orlikowski, Senge,
2007) . It is wise to acknowledge that no one person could fit the defined role perfectly, and the
sooner we abolish the preconceived notion that a manager must be an all-in-one perfect leader,
the sooner management can evolve to better capture the opportunities and handle the challenges
brought on by this new global economy (Ancona et al., 2007).
According to Mintzberg (1990) the classical view about what managers do is faulty; as the
pressures to perform keep rising, resulting in overwhelming amounts of responsibility, they
don’t have the time to reflect and do what managers are assumed to do—organize, coordinate,
plan and control. They simply have too much on their plates and Mintzberg (1990) rightfully
feels that without being honest about what managers actually do, we cannot improve on the
practice. According to his research, managers have three interpersonal roles, three informational
roles, and four decision roles, which managers do not necessarily engage in all equally
(Mintzberg, 1990). To be as effective as possible managers must be self-aware, wisely share

5. information, delegate decision making to the right people, and switch their obligations into
advantages while turning what feels important into obligations.
Almost 20 years later, a similar yet evolved theory emerged. Similarly, according to a six year
research by Deborah Ancona, Thomas W. Malone, Wanda J. Orlikowski, and Peter M. Senge,
(2007) expecting managers to satisfy all company management needs has become impossible,
setting the bar too high for any one person to achieve, yet managers still unsuccessfully try.
Instead, ‘incomplete leaders’, as Ancona et al. (2007) coined them, know what to delegate, when,
and how to compensate for their weaknesses through others. They developed a model describing
the four leadership capabilities, which closely relate to Mintzberg’s (1990) ten roles, all of which
are necessary for corporate success, but that no one manager possesses in their entirety. The four
capabilities include: sensemaking (understanding the complexities around them), relating
(building and utilising their relationships effectively), visioning (painting an enticing vision
which compels others to follow the same goals), and inventing (bringing the vision to life)
(Ancona et al., 2007). These are necessary to accomplish Mintzberg’s (1990) roles: One cannot
effectively monitor hearsay without being able to make sense of it; act as a liaison without being
able to relate to others; be a successful leader without selling a vision others will follow; nor act
like an entrepreneur by making improvements without strengths related to inventing. The study
takes it a step further than Mintzberg, and concludes that managers aren’t just overwhelmed and
unfocused; they simply do not naturally have all the capabilities necessary (Ancona et al., 2007).
Instead they should have a single responsibility: to create an environment where all strengths are
complemented and weaknesses are offset, and in doing so, delegating leadership across the
organization (Ancona et al., 2007).
Instinctively, the managers we interviewed strived to adopt the adaptive style regardless of what
came natural to them. Without involving knowledge workers in decisions managers may miss
out on amazing opportunities. One of our high-end knowledge workers interviewed expressed
great frustration about working with a team leader who exudes too much control in his work, so
much so he simply stopped listening. Luckily, his rebellion resulted in unprecedented success
last fall. Annoyed with the countless hours of routine data entry work for a long-term client—he
decided to automate the process. What took 24 hours per run command, and often resulted in
mistakes and more time wasted to rectify them, was reduced to only taking 35 seconds to fill;

6. saving his team anywhere between 72-480 hours per week. The best part is that the client is
charged per run command, so this alone significantly expanded the company capabilities and
profit. According to Ancona et al.’s (2007) model, this IT professional possesses the visioning
and inventing characteristics; meaning he conceptualized a dream, and brought it to life. This is
the equivalent of Hertzberg’s entrepreneur decisional role, which he undertook temporarily
without taking on other roles. This is the advantage of managing high-end knowledge workers;
they have the ability to contribute at a higher level. Ideally, according to Ancona et al., his
manager should entrust him with this leadership objective at any appropriate time.
Due to the effects of globalization, organizations have become increasingly flat; a change from
the command and control hierarchies of the past (Meyer, 2014). Conveniently, today’s workers
now possess a higher education, better communication skills, and stronger analytical skills to
process information and respond accordingly (Carleton, 2011). This phenomenon makes Ancona
et al.’s theory increasingly more relevant than Mintzberg, though the idea remains the same: The
first step toward improving the efficiency of managers requires them to first challenge their
preconceptions in order to better re-focus their efforts.
What can we conclude?
Decades have passed since Drucker first spoke of the importance of effectively managing
knowledge workers, and judging by Handy’s sigmoid curve theory, today’s businesses are
struggling because we have not adapted in time for the shift. Due to the significant changes in the
workforce, and the increased threats and opportunities brought on by globalization, it should be a
top priority for organizations to determine how to gain the most from their workers. Recent
studies, however, still do not give clear cut answers. The good news is we are finally admitting
that no manager is an all-in-one perfect leader, and if we accept this we may better focus our
energy to effectively channel the collective strengths, creativity and ingenuity of all knowledge
workers—or at least those at the high-end of the spectrum.

7. Bibliography
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incomplete leader. Harvard Business Review. Retrieved from https://hbr.org/2007/02/in-
praise-of-the-incomplete-leader
 Byrne, J. A., Gerdes, L. (2005, November 27). The Man Who Invented Management.
Bloomberg Business. Retrieved from http://www.bloomberg.com/bw/stories/2005-11-
27/the-man-who-invented-management
 Carleton, K. (2011). How to motivate and retain knowledge workers in organizations: A
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