KNOWLEDGE AND INFORMATION WORK IN ORGANIZATIONS

Abstract

Since the turn of the century, the United States, Canada, and Western Europe have been moving toward service and information economies and away from an agricultural and manufacturing economies (Euromonitor, 1990; Machlup, 1962; Rubin and Huber, 1986; Porat, 1977). The fraction of workers using information to produce economic value has been rising, and the fraction working with their hands in factories or on farms has been declining. In the United States, the percentage of jobs in manufacturing fell from 27 percent in 1920 to 17 percent in 1990. In the European Community, the value-added by manufacturing grew at an average annual rate of 6.2 percent from 1960 to 1970, but this growth rate was only 0.7 percent from 1980 to 1985. Among white-collar workers, the fastest growing occupations have been clerical, professional, and technical workers, and managers and administrators (Wolff and Baumol, 1987).

Six factors have been involved in this shift. First, third-world and developing societies have become centers of manufacturing, while the so-called advanced societies have shifted toward services. In Europe, the telecommunications sector has been growing about 9 to 11 percent annually, and the software and computing services sector has been growing 15 to 20 percent annually (Sema Group, 1991). Second, knowledge-intense and information-intense products and services have grown rapidly, and the production of traditional products has also been using knowledge more intensively. Third, business has invested heavily in equipment to support information work. In the United States, information-related equipment accounted for 20 percent of capital investment in 1979; this figure had become 40 percent of capital investment by 1986. Fourth, knowledge workers and information workers have replaced manual production workers within the manufacturing sectors. Machine-tool operators, for instance, have often been replaced by technicians who monitor computer-controlled machine tools. Fifth, workers have increased education and information-processing skills (Howell and Wolff 1991). Sixth, new kinds of knowledge-intense and information-intense organizations have emerged that are devoted entirely to the production, processing, and distribution of information. These new kinds of organizations employ millions of people (Office of Technology Assessment, 1988).

As early as 1976, the value of information-sector products and services had already exceeded that of the manufacturing sector in the U. S. By 1990, the information sector (including services) accounted for $3 out of every $4 of GNP, and over half of the U. S. workers were doing some type of information work (Howell and Wolff, 1993; Roach, 1988). The U. S., however, represents an extreme case. For instance, in the software and computing services sector, the United States has about 55 percent of the world market, the European Community has about 25 percent, and Japan has about 8 percent (Sema Group, 199 1).

This article surveys information work, information workers, and the computer systems that support such work. It then examines the organizations that are most dependent on knowledge and information work -- knowledge-intensive firms.