Think Inc.
A forum for Hawaii's
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Sunday, May 12, 2002

What's cooking | Gas cap smells



What’s cooking

Implementing new information technology
is not enough. The system needs to be
reconciled with the values of the users

By Jerry Glover and Gordon Jones

Knowledge is the sum total of what humans and their organizations know about their world. Thus, culture is the warehouse, as well as the conduit, for both adaptive and maladaptive knowledge in any human setting. This means that all efforts to acquire and use information occur within the cultural context of an organization.

Any new technology or management information system is a product of the social system in which it is found. Unfortunately, leaders often fail to realize the importance of this fact when attempting to effectively integrate an innovation in an organizational setting.

We recall a casino hotel general manager in the Caribbean who had asked the human resources director from the corporate office in Miami to determine the cause of a "labor issue" in one of the property's restaurants. Upon her arrival, the human resources director spoke with the general manager to assess the problem.

The general manager related that, for the past six months, what had historically been a well managed and high quality food outlet in the hotel had recently become a problematic and troublesome enterprise. Customer complaints regarding the service and the attitude of the employees had greatly increased during that period. Several long-time employees had resigned. Many others had complained about having too much work to do. There were rumors of a possible grievance against management.

She next met with the waiters in the restaurant. After gaining their confidence, she learned from the waiters the source of their frustration in the workplace. "Ever since the new computer (a point of sale terminal in the customer service area) was installed six months ago, we don't have the time to do our jobs. We work twice as hard now."

"But I thought the new technology was designed to make your life easier," she responded.

The waiters explained to her that since the new computerized system had been installed, they took the customers' orders, entered them in the terminal in the service area, and then went to the kitchen to tell the cooks what they had entered in the terminal in the service area.

"Wait a minute," she responded. "Why do you have to go to the kitchen to tell the cooks what order you placed in the terminal? I thought they had a visual display terminal in the kitchen to tell them the orders you placed from the service area."

After a few anxious moments, one of the senior waiters revealed the waiters' secret to her. "Yes, that is true, but the cooks can't read."

She further discovered that the technology-consulting firm that had installed the point of sale computer system had not bothered to assess the skills of the restaurant staff. Instead, they installed the terminal, met with the restaurant manager to "train him" in its use, and then left. Meanwhile, the cooks were concerned that they would lose their jobs due to their inability to read. Their long-term friends, the waiters, had been covering for the cooks to protect them from management.

The general manager and restaurant manager had been unable to understand why the problems had developed in the workplace. They had introduced a new technology to keep the restaurant in vogue with current trends in accounting and information systems, but they had failed to discover important information about their workers beforehand. As a result, a system designed to increase productivity had produced the opposite outcome. Change had occurred, but it had not helped the organization adapt. In fact, productivity had been on the decline because of the maladaptive way in which the new technology had been implemented.

Adaptive leaders need to be able to reconcile the design of new information technology with the values of those who will use it. Computer systems, telephone answering menus, and other information systems are effective only if they are compatible with the social context in which they are implemented. Effective knowledge management, therefore, has three equally important aspects: hardware; software; and the social system in which it is used. Ignore any one of the three aspects and most likely the system will fail to achieve its intended result.

Next we will discuss creating synergy from diversity.

Jerry Glover is a professor of organizational change at Hawaii Pacific University. Gordon Jones is a professor of management information systems at HPU. They can be reached at and



Gas cap has bad smell

By Michael W. Perry

Well, we're No. 1, and already reaping the appropriate recognition from the rest of the country.

No ... not volleyball. This is about gasoline. Hawaii is the first state ever to attempt to regulate gas prices. And the recognition we're getting is not, as Martha Stewart would say, a good thing.

The Wall Street Journal and other business media have taken notice. But what fault could they possibly find with a saintly legislative gesture ensuring low-cost fill-ups for our Pathfinders? Isn't capping the price of a commodity good policy? Or just too good to be true?

Let's follow the logic. We want the state government to create a new bureaucracy to regulate the price of gasoline because:

>> The price of gas is very, very high. Sorry ... the real cost of gasoline is actually about as low as it's been for 30 years, a fact universally ignored when TV reporters trot out the inevitable whining-at-the-pump consumer for a soundbite about how unfair these prices are. Getting someone to complain on camera about the price of gas is apparently very easy. The truth: If you were pumping gas at 1981 prices, adjusted for 21 years of inflation, figure on about $3 per gallon.

>> Oil companies are gouging us with their obscene profits. This would be news to Chevron-Texaco shareholders, who have seen their stock flatline for the past 3 years. The fact that the state tried to prove the gouging thing, but settled a gazillion-dollar lawsuit for a dollar three-eighty speaks volumes. It must be a little more complicated than it looks.

>> Price caps work. One word: California. Its incurably idealistic legislators decided to cap the price of energy back in the '90s. Folks in the Golden State ran their hot tubs 24/7, recklessly churning through the artificially cheap kilowatts, unwittingly encouraging Enron mischief and loving the whole thing ... until last year when the rolling blackouts started. It turns out there's no free lunch. Energy companies who can neither make plans, nor profits, go elsewhere.

C'mon now, Legislature. I've never met one of your guys who I didn't like personally, but as a group you get weird sometimes. Even if an attempt to repeal the laws of economics actually resonates with you, we still have to assume you're not totally serious about it because you put off implementation until 2004.

If you just wanted to send a pre-election "Valentine" to the voters, well done. If you wanted to tell Chevron and Tesoro not to mess around with you, nice going. But you also sent a message to the rest of the country that screams "It's anti-business as usual in Hawaii." If you really want to do something about "high" gas prices, here are four unsolicited suggestions:

>> Lower gasoline taxes. Ours are the highest in the United States. Approximately a third of what we all paid for our last tankful of gas went to ... uh ... you.

>> Encourage -- really encourage -- competition.

>> Next time you see either Sen. Akaka or Sen. Inouye, genuflect. The two Dans, plus one Republican, were the only senators to vote for both better gas mileage standards for cars and drilling in the Arctic National Wildlife Refuge. These days, it's dangerous to be at the mercy of Saddam Hussein, or the Saudis, or whoever is having a crude oil tantrum.

>> Study the phrase "marginal utility of low-volume producers in an isolated market with inelastic demand" and what it might mean to Chevron in an economic downturn.

There is time to contemplate these things before 2004. In the meantime, remember: if it sounds too good to be true, it's probably an election year.

Michael W. Perry is co-host with Larry Price of the morning show on KSSK radio.

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