Leadership for the Knowledge Economy
White Paper: Ó2005 Legacy Education
“Reading, ‘riting, and ‘rithmetic” were
the foundation for business literacy at the beginning of the 20th century as the economy shifted from an agricultural
to an industrial base. Reading, writing and arithmetic are still essential, but
they are insufficient for the information age and an economy based on the power of the mind.
The knowledge economy is an exponentially complex world, where the mind trumps
muscle and machine, where a global corporation with only five employees can have annual sales of $160 million. It is a fast and sometimes brutal world, where an industry leader like Netscape can be marginalized in
just three years.
A new construct for business literacy is needed
if American industry is to remain competitive. With alliterative license, “Three
Rs” for the knowledge economy emerge—
Relationships, Research and Risk
Relationships--the ability to maintain a non-anxious, non-judgmental self
in connection to other persons or groups in such a way that all are respected and goals achieved.
Research--the intellectually rigorous and creative exploration of divergent
sources of ideas, information, and resources.
Risk--the exercise of sound judgment and timely, decisive action.
The bottom line for any business venture is the capacity to produce goods and
services—to get things done that are valued in the marketplace. People
(relationships) determine what the marketplace values, information (research) generates products and services, and decisions (risks) get
things done. Whatever concept, product, or service a business undertakes, relationships,
research, and risks are central to successful implementation.
Competency, or lack of it, in the “new” 3-Rs is pivotal, regardless
of title and position. Leaders and workers alike must master them in order to
contribute to the knowledge economy. Roles and
responsibilities may be fundamentally different, but every worker can lead within the context of their unique sphere
of influence. In other words, everybody counts.
Innate ability for relationships, research, or risks will vary from one person
to the next. Some will be more skilled than others, but no one should be counted
out or left behind. To do so would be costly in both personal and corporate terms,
wasting resources the economy can ill afford to lose.
Skill in one competency does not preclude the necessity for ability in the
other two. Just as no one would suggest that if you can add, you don’t
need to read and write, skill in relationships, research, and risk must be developed intentionally and universally—in
every classroom, in every workplace training program, in every leadership development
Relationships are a good place to begin, but the difficulty in developing and
sustaining effective relationships should not be underestimated. Relationships
are the joy and/or bane of human existence—sometimes both at once. We begin
collecting, sorting, and storing relationship signals from our birth, and continue to do so daily. In addition, we are intricately connected to our surroundings, tuned in to sending and receiving signals
as surely as electricity is transmitted—silently and efficiently. If we
understand that any group of people assembled for a common purpose will instantaneously create an emotionally wired system,
we begin to sense the depth and breadth of the skills required. Effective relationships
are even more important in a virtual world where it is often necessary to build trust across global networks. We often need to see, assess, and relate to others with split-second speed and efficacy.
Knowledge and facts have always been essential to sound strategy. Technical mastery is commonly accepted as a baseline credential for employment. What distinguishes research within the knowledge economy is an overriding sense of
urgency and an insatiable quest for innovation. Implicit knowledge must become
explicit, managed, and shared—capable of linking knowledge workers across continents.
Intellectual capital must be harnessed, organized, and measured as accurately as equipment and inventory. Creativity must be constantly nurtured. Knowledge workers,
deluged with information, must hone their ability to discriminate and isolate with precision the solutions that give them
a competitive edge.
Relationships and research, pursued in isolation, can never generate
the quantum productivity gains inherent in the knowledge economy. Camaraderie
is no substitute for competitive strategy. Data overload can jam entrepreneurial
Ultimately, the ability to assess and take risks becomes the third
necessary competency. Business leaders confronted with ambiguous and/or paradoxical
situations must make hard choices. To complicate matters, decisions are rarely
static. Every decision leads to yet another that, for a time, has the potential
for success or failure. Choosing to do nothing is equally problematic. Will Rogers said it succinctly, “Even
if you are on the right track, you’ll get run over if you just sit there.”
There are persons for whom risk-taking is second nature. They take risks often and easily, concentrating on relationships and research as retrospective exercises
to manage the unintended consequences of their decisions. Others spend their
energy on relationships and research up front, paving the way more carefully so that risks are mitigated whenever possible. Either way, risks are inevitable.
can a leader do?
Adopting the new 3 Rs merely as a slogan or mantra is likely to be viewed as
just another flavor of the month. For such a simple alliteration to have
an impact on competitive strategy, relationships, research, and risk must be ingrained in an organization’s DNA from
top to bottom.
Organizations and leaders are caught in a conundrum. They want to learn--if
it is cheap, fun, and easy--but are frustrated by the cost and complexity of the process.
Attending a three-day class (or sending someone else “who needs it”) is much easier than developing a clearly
focused human capital strategy based on the personal mastery of its leaders.
As Ben Franklin suggested long before there was any glimmer of a knowledge
economy, simplicity on the other side of complexity is a good place to begin. Leaders
who model and teach effective relationships, rigorous research, and courageous risks can expect to have a powerful impact
on productivity. There is no time to waste.
Carol Tyler Townsend