The document discusses the evolving nature of knowledge workers and their significance within organizations, highlighting that they should be viewed as valuable assets rather than costs. It emphasizes the managerial responsibilities in fostering an environment that supports the performance and motivation of knowledge workers, including removing obstacles and tailoring incentives. The text concludes with a call for new management approaches that prioritize development and collaboration over traditional hierarchies.

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Development Bank, or its Board of Governors, or the governments they represent. ADB does not guarantee the accuracy of the data included
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Managing Knowledge
Workers
Olivier Serrat
2013

2. Landmarks of Tomorrow
"Productive work in today's society and economy is work
that applies vision, knowledge, and concepts—work that is
based on the mind rather than on the hand," wrote Peter
Drucker in 1959 in Landmarks of Tomorrow.
In Management Challenges for the 21st Century, published
in 1999, Peter Drucker's lifelong analysis of the shift to
knowledge work imparted one more prescient expression:
"The most valuable assets of a 20th-century company were
its production equipment. The most valuable asset of a 21st-
century institution, whether business or nonbusiness, will be
its knowledge workers and their productivity."
The Next Society will be a knowledge society.—Peter Drucker

3. Management Challenges for the
21st Century
More than 50 years after Peter Drucker coined the term
"knowledge worker", assumptions about people working in
organizations are less and less tenable: they are not
subordinate employees retained around the clock and they
do not rely on their organization for livelihood and career.
There is life in hierarchies still. Yet, in the United States,
Europe, and increasingly elsewhere, the largest single group
of workers are knowledge workers who may practice at an
organization but might not be its employees. And, even if
they are in full-time employment, few are subordinates.
For the authority of knowledge is surely as legitimate as the authority of
position.—Peter Drucker

4. From Costs to Assets
Knowledge workers produce and distribute ideas and
information rather than goods or services. By definition, they
are individuals with different aspirations from the hierarchy-
conscious personnel of the past; they are also mobile and
they do leave.
Hiring talented people is difficult but keeping them is even
harder. So, to plug the drain of human capital in a
competitive knowledge economy, knowledge workers should
be treated as an asset rather than as a cost. Preferably, they
should be managed as though they were partners (or at
least volunteers).
Mediocrity knows nothing higher than itself, but talent instantly
recognizes genius.—Arthur Conan Doyle

5. The New Managerial Task
Making knowledgeable people perform is not a matter of
making them work harder or more skillfully. Naturally, they
are dedicated and such interventions are beside the point.
Rather, the managerial task relates to removing obstacles to
performance and then channeling efforts into areas that will
contribute to the accomplishment of an organization's
objective. For that reason, managing talented workers for
performance is best understood as a process of influence.
A manager is responsible for the application and performance of
knowledge.—Peter Drucker

6. On Managing Talent …
To begin, establish a framework in terms of culture,
structure, and style of management in which the talent of
knowledge workers can flourish. In exercising this process,
accommodate these people's preferred ways of working. The
result is that knowledge workers understand, identify with,
and see how their own contribution can be enhanced. They
put their best abilities to the test. They challenge and
achieve.
Hire people who are better than you are, then leave them to get on with
it … Look for people who will aim for the remarkable, who will not settle
for the routine.—David Ogilvy

7. On Managing Talent …
To build such a framework, (i) recognize outstanding talent
wherever it is found; (ii) establish clear task objectives and
performance standards in consultation with each knowledge
worker; (iii) extend incentives, rewards, and reinforcements
that meet the motivational patterns of each knowledge
worker; and (iv) provide opportunities for improvement.
As organizations redesign in the knowledge economy,
they will have to quickly address the elemental issue of
motivation. Reliance on such staples as wages, fringe
benefits, and even promotion may soon be passé.

8. … With Knowledge Managers
Certainly, knowledge workers require knowledge managers,
not bosses. These new-era managers need to set and
enforce on themselves exacting standards for their
performance of those functions that determine ability to
perform. Time and again, traditional managers exercise no
leadership at all but only position power.
Managing knowledge workers requires that managers
themselves act as good follower and team player as well as
leader and technologist.
I believe the real difference between success and failure in a corporation
can be very often traced to the question of how well the organization
brings out the great energies and talents of its people.—Thomas J.
Watson, Jr.

9. … With Knowledge Managers
Since the process of influencing the performance of
knowledge workers is mainly developmental, managers need
also to hone skills in appraising, coaching, mentoring, and
providing feedback. One measure of their effectiveness will
be by the quality of the (internal and external) relationships
that they create.
The knowledge economy is pruning status, power, and
upward mobility from the managerial role. From now on,
would-be new-era managers will be asked to reply
convincingly to a simple question: Why should a knowledge
worker want to be managed by you?
Most of what we call management consists of making it difficult for
people to get their work done.—Peter Drucker

10. Further Reading
• ADB. 2008. Managing Knowledge Workers. Manila.
www.adb.org/publications/managing-knowledge-workers
• ——. 2009. Growing Managers, Not Bosses. Manila.
www.adb.org/publications/growing-managers-not-bosses
• ——. 2010. A Primer on Talent Management. Manila.
www.adb.org/publications/primer-talent-management
• ——. 2010. Leading Top Talent in the Workplace. Manila.
www.adb.org/publications/leading-top-talent-workplace

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