|It's Innovation, Stupid
March 14, 2000, The Business Times (Singapore)
by: Anna Teo
The knowledge economy is not the tech economy, not the info age. It's about harnessing people's intellectual capability, a visionary tells ANNA TEO.
BACK in 1987, way before there was any particular focus on (nor understanding of) terms like "knowledge economy" and "intellectual capital", Debra Amidon held in the United States a conference on managing knowledge assets into the 21st century. It was the first of its kind in the US, and, she believes, one of the first in the world.
Today, she is widely acknowledged as an authority on the global knowledge economy, a leading light in the field, and is founder and chief executive of a global virtual innovation research and consulting network - Entovation International Ltd - that spans some 70 countries. Her thoughts and views on the subject are up on the World Wide Web in nine languages, including Russian and Turkish, and her books are published in various European languages and Chinese - the Beijing government is among countries that has sought her advice on making the leap to a knowledge economy.
And it all started with that conference back in 1987, when she was then a research manager and associate director with Digital Equipment Corporation in her home state Massachusetts. She had joined the company after various senior academic and government posts, and her last job title at DEC, before she left in 1993 to set up Entovation, was "global innovation strategist".
"Having lived in all three worlds - education, government and industry - I can see more similarities than differences. I can see the connections. They all come together with the focus on knowledge - all these organisations are trying to build their intellectual capacity, their learning capacity, their ability to apply knowledge. So you put that together, that was the foundation for the conference I held in 1987," she says in an interview here last Friday.
She saw a need then to better manage the US' knowledge base in education, government and industry. "I talked about harnessing the intellectual capital of a nation. It wasn't well-defined then, but now it's rolled into a global community of knowledge practices," she says.
But while the focus on knowledge has since exploded worldwide, there remains much misconception and misunderstanding about many of the terms, ubiquitous though they may be. Take "knowledge economy" to start with. "It is not the technology economy, it is not the information economy, it is not the Web economy, it is not the digital economy," she says. "All of those things focus on things outside the human being. The knowledge economy is human - it's about harnessing the intellectual capability of people."
It follows then that the "knowledge economy" is not the exclusive preserve of advanced countries, and ''there's no such thing as a non-knowledge worker", or, for that matter, a non-knowledge-intensive company.
"We now know that knowledge is actually the source of wealth creation, not technology. So the whole focus on information technology, on computer technology, communications technology, multimedia technology, the Web, etc. - these are enablers; they enable the knowledge society. But the focus is on the knowledge society, not the technology itself.
"So what good is it if you hold your knowledge inside yourself, if it's not shared and applied, if it does not in some way create value. And that's the reason why innovation strategy is important - innovation is knowledge in action." Or "idea to action", as she has defined it elsewhere. Innovation is the one competence needed for the future, and is integral to the business strategy.
Innovation Strategy for the Knowledge Economy: The Ken Awakening (1997), her third book on the subject, sets it all out, including an evolution of the knowledge movement and ten dimensions of an innovation strategy. And again, "it's not innovation the way we've known it", largely in terms of technology, R&D, invention, etc. Instead, what is key is creating, sharing and applying knowledge - ie redefining the term according to the flow of knowledge.
As Ms Amidon told Knowledge Inc in an April 1998 interview: "One has not innovated until the market demands more of your technology. For example, Post-It Notes was a good idea. But just researching, manufacturing and getting the product to market is not innovation. Innovation occurs when the marketplace puts demands on the technology such as, 'Hey this is great. Do you have it in different colours? Does it come in different sizes? Can it be produced with our company logo?' That's innovation."
And focusing on knowledge management - one by-product of the knowledge movement - is sub-optimal, she tells BT. The term "knowledge management" is an oxymoron; the real challenge for most companies is faster innovation.
Creating the system within which ideas are created and applied is more than management; it is a matter of strategy and leadership. And that's where "knowledge innovation", an Entovation® proprietary term, comes in.
In their own words, knowledge innovation is the creation, evolution, exchange and application of new ideas into marketable goods and services for the success of an enterprise, the vitality of a nation's economy, and the advancement of society.
This recognises knowledge - not technology or finance per se - as the core component of innovation. Nurturing and managing the flow of knowledge may be the most distinctive competence of the decade, she says. And there's actually nothing new, or magic, about the focus on knowledge, she adds. It has existed since Socrates and Plato, since people started communicating on earth.
"What is different is, now we can find ways to manage the infrastructure within which knowledge is created, and move it. So we can actually begin to manage the innovation process, and the knowledge inherent in it, and convert it into prosperity."
Another point Ms Amidon wants to drive home: The knowledge economy is ''an economy of opportunities". Over the past 50 years or more, the focus had mainly been on identifying issues and solving problems; the company mission has tended to centre on the product, and then on providing "solutions" to problems.
"Most people focus on today's business, what's articulated and what's already served in the market. And if they're aggressive they might try to understand what's unarticulated and what's unserved. But the fact of the matter is that the real opportunity is the unarticulated need and the unserved market. However, customers know more than you think they know."
Investing in tapping customers as a source of knowledge may therefore be key to business strategy too.
She cites the example of a hotel in Canada where she was staying while running a big conference. She needed copying services, and found three Kinkos in the telephone directory. But, being new to the city, she had no idea which was nearest to the hotel, and was about to pick up the phone to call and find out when she saw, along with "operator", "wakeup call" and other buttons on the phone, a button called "Kinkos".
It can't be, she thought; Kinkos is a copier service in the US and Canada, but could it be something else called Kinkos? She pressed the button, and sure enough, it was the copying service, and no, it wasn't any of the three listed in the phone book, located miles away. "They were right downstairs, on the third floor of the hotel! I couldn't believe it. Somehow, they had been tapping into customer knowledge to know what customers really need in that business facility."
Unfortunately, the Singapore hotel she stayed in during her short visit here last week provides an example in contrast. "We needed some things copied. But printing at the hotel costs too much - 50 cents per page, and we had many pages. Now, next door to the hotel is the printing shop, which charges four cents per page."
The point is, she adds, this is an economy of opportunity, so the focus in the 21st century is not solutions. "It's the innovation process; it's how fast ideas are created and put into products and services; literally it's a function of innovating with the customer."
Bypassing Industrial Phase
by: Anna Teo
Level playing field allows developing nations to leapfrog to knowledge economy THESE days, just about every country, including developing economies, wants to be a knowledge-based nation. But mark her words, Debra Amidon suggests - the developing countries can, and will, leapfrog from being largely agricultural societies to knowledge-based, without going through the industrial phase.
"What we're talking about is harnessing the intellectual capability of people. That touches every human being, regardless of race, regardless of level of development. So in that sense, the developing countries can and will leapfrog to a knowledge economy, without having to go through the downside of an industrial economy," she says. "Now what they have to do is, they will have to know what the upside of an industrial economy is, and they'll have to include that as they're transforming into a knowledge economy. The industrialised nations, on the other hand, have to unlearn a lot in order to move to the new economy. But you can actually see what's happened with the focus on knowledge is that worldwide, it has created a level playing field, because the rules are going to be completely different, and the opportunities are so vast."
Massachusetts-based Ms Amidon is familiar enough with the knowledge-economy aspirations of developing countries - over the years, she has made presentations across not only north America and Europe, but also in Mexico, Peru, Brazil, Chile, Venezuela, South Africa and China. Indeed, when she flew into Singapore last Wednesday evening - from Kuala Lumpur, where she had addressed a Global Knowledge Conference attended by many developing countries - she had been in 10 countries on five continents in six weeks. All in the business of spreading the knowledge gospel.
"There's now a plethora of conferences around the world, in every industry, in every function, and nations all over the world are proposing to be a knowledge nation," she says. "I think Korea was one of the first to say it would be a knowledge nation - Korea has completely translated my Web site (www.entovation.com) into Korean, three years ago.
"China two years ago translated my book into Chinese, and the Beijing government invited me for 10 days two years ago. I was hosted by the National Academy of Sciences." She found there were then already seven study commissions in Beijing looking into the implications of the knowledge economy for China.
The global focus on knowledge has tremendous depth and scope, she says. The movement is only about 13 years old - since her seminal conference in the US in 1987 - and companies, organisations like the World Bank, and whole countries, are developing initiatives to go the knowledge way. The Global Knowledge Conference in KL early last week, backed by the World Bank and attended by some 1,200 people from 90 countries, "was an attempt for all nations of the world to come together to realise that there's a better way to manage our future - we're not managing with land, labour, capital, or even computers, because those are resources, as many as we can produce; they're 'outside' and they get used up", she says. "We're now looking at knowledge as the resource, and knowledge expands as you share it; it doesn't get used up."
Singapore appeared to have missed the conference in KL, but Ms Amidon met officials from the Economic Development Board, Singapore Productivity and Standards Board (PSB) and Singapore Technologies during her visit here. Her session with PSB officials, for example, stretched from a scheduled one hour to almost three hours. Says Steve Lai, general manager, technology and quality assurance, at PSB of their meeting: "It's very interesting, her approach. Her view is that some of the things that need to be addressed is really at the systems level, especially systems dynamics, and not at the process level. You're looking at things like how people react to changes, etc." There's the behavioural issue in innovation strategy, for example, Dr Lai cites. Many organisations focus on the technical, capital, economic parts of innovation strategy, and neglect the behaviour aspects. "She's pointing out that that is really where, in the long run, you get your returns." PSB is looking at opportunities to bring her in and tap her expertise on the subject, he adds. On her part, Ms Amidon says she senses from her meetings here that "some people are confused about some of the terms, they're holding on to some of the old, traditional management, which is natural, because there has not been a comprehensive systematic way to diffuse the essence of what this new economy is yet".
Yet, from her visits to countries in Asia, Latin America and Africa, she has found, she says, a high degree of government involvement, a topdown approach in dissemination. "If the governments can realise that they can use the infrastructure to be a catalyst for them to define the direction forward and the framework, and let the ideas bubble up with the initiative, and provide the incentives at the right pint, they've got a better chance of actually capitalising on the knowledge economy than others.
"If they treat it as command and control - we're going to figure out the answers and we're going to instruct, then it won't work, it won't be effective." But for Singapore, "I think now there's a critical mass of awareness, at the executive level, to understand now what this might mean and I think you will see them move very quickly", she says. "And I hope so, because I want to see Singapore highly successful, so that I can use it as an example as to how other developing nations can do the same thing."
BIODATA - Debra M. Amidon
Chairman and CEO of Entovation® International Ltd, Massachusetts, US
© Copyright 2000. Used by permission.
1996-2000 ENTOVATION® International. All rights reserved.