An investigation of the differing approaches of successful companies (winners) and their unsuccessful competitors (losers) has identified many opportunities for boosting profitability and generating additional revenue streams by better exploiting corporate know-how. The findings set out in ‘The Knowledge Entrepreneur’* a handbook with exercises for crafting new knowledge-based offerings and checklists of questions that individuals and boards need to ask reveal the full extent of the possibilities.
Could you and your colleagues quickly secure new income streams and transform the productivity of your current operations by better exploiting what is already known? The most promising opportunities for revenue and profit growth are being overlooked in many companies. Processes for exploiting corporate know-how simply do not exist.
Many people overlook relatively easy ways of improving corporate performance and delivering greater shareholder value. They devote insufficient attention to the development, sharing and exploitation of information, knowledge and understanding. They are also unaware of how relevant knowledge, critical success factors and the approaches of high performers can be built into work processes and support tools.
An investigation of the differing approaches of successful companies (winners) and their unsuccessful competitors (losers) has identified many opportunities for boosting profitability and generating additional revenue streams by better exploiting corporate know-how. The findings set out in ‘The Knowledge Entrepreneur’* a handbook with exercises for crafting new knowledge-based offerings and checklists of questions that individuals and boards need to ask reveal the full extent of the possibilities.
Opportunities for income generation exist at all levels and many areas of the companies examined. For example, thirty one distinct learning support services were identified that a typical training and development unit could offer external customers.
The investigation reveals how a new generation of knowledge-based support tools can enable key workgroups such as new business and customer relations teams to adopt the approaches of superstars and emulate their behaviours. However, even the most successful of the companies examined are overlooking their existence and potential.
Corporate policies, systems and procedures are heavily biased towards physical assets and tangible activities. Considerable effort is devoted to protecting and maintaining physical assets, keeping records of them up to date, and ensuring they are properly depreciated and fairly valued in annual accounts, and physically verified by the auditors at the year end; while intellectual assets are inadequately managed.
Losers do little to capture, value and protect corporate know-how. In comparison, winners are more aware of how information flows, support tools, knowledge transfer, and the exchange and sharing of relevant understanding impact upon performance. They are more alert to the possibilities for knowledge entrepreneurship.
Reporting systems and performance indicators used by losers focus upon data that is easy to collect rather than the areas that are intrinsically of greatest importance. Few of them systematically assess, monitor and reward learning or the creation and exploitation of new intellectual capital. Many companies would benefit from tracking indicators such as net income from new knowledge-based ventures and offerings in relation to the value of available intellectual capital.
Winners are more aware of certain aspects of knowledge entrepreneurship such as fostering creativity or measuring and reporting intellectual capital. However, even among the more successful companies systematic strategies for creating and exploiting know-how across all functions and areas of operation were extremely rare.
The findings of the continuing investigation suggest certain key questions that need to be asked if entrepreneurs, boards and management teams are to create environments that are more conducive of knowledge entrepreneurship:
Does the company operate in a sector in which know-how accounts for an increasing proportion of the value being generated for customers? If so, what are the implications?
Do members of the board and management team understand the requirements for success in the knowledge society and information age? How many of them are knowledge entrepreneurs?
Does the company have a convincing rationale and clear purpose? Is there a shared, distinctive and compelling vision? Does it reflect opportunities for knowledge entrepreneurship?
Have the vision, mission, goals and objectives of the company been effectively communicated and shared? Have the various elements of capability - including relevant know-how - needed to achieve them been assembled?
Is there an explicit strategy for the acquisition, development, sharing and exploitation of information, knowledge and understanding? Who has specific responsibility for it?
Do people have the knowledge-based support tools they need to quickly communicate what is special and distinctive about the company and its offerings? Who ensures that important workgroups have the support tools they need to excel in their jobs?
Are members of the board and management team role models in relation to learning and the sharing and exploitation of information, knowledge and understanding? Are the corporate culture - and the attitudes, values and perspectives of the people of the organization – conducive of knowledge entrepreneurship?
In particular, what action needs to be taken to break down barriers and overcome obstacles to the acquisition, development, sharing and exploitation of know-how? Is there effective two-way communication between the corporate centre and business units, and horizontal communication across functional, process and unit boundaries?
Is the organisation moving up or sliding down the information, knowledge and understanding value chain within its sector of operation? Is priority given to the company’s customers and the acquisition, development and application of the know-how needed to deliver more value to them?
What explicit steps are being taken to create and support a community of knowledge entrepreneurs, create new knowledge based offerings and build practical support tools that make it easier for people to do their jobs and emulate the success of superstars?
Have the key processes for the acquisition, development, sharing and exploitation of know-how been identified? Do information, knowledge and understanding flow effectively up, across and down the organization and around its networks of relationships?
Are there opportunities for different individuals, work groups, business units, venture teams and business partners to develop ideas for new knowledge-based offerings and seek appropriate support? Are feedback loops built into the company’s operating, learning and entrepreneurial processes? Are they regularly reviewed and refined?
Finally, are the intellectual assets of the organization safeguarded as effectively as its financial and physical assets? How effectively and systematically are they being exploited? Is performance in these areas monitored?
The culture, policies, processes and practices of an organization should enable the effective acquisition, development, sharing and exploitation of know-how. Shrewd investors assess how effective companies are in these areas, and the extent to which people derive meaning and create opportunities, value and intellectual capital from various forms of information and knowledge. In essence they assess a board and management team’s ability to encourage and enable knowledge entrepreneurship.
© Colin Coulson-Thomas, 2005
Further Information
*’The Knowledge Entrepreneur’ by Colin Coulson-Thomas (Kogan Page, 2003, £22.50, Hardback, 0 7494 3946 7, 240 pages) can be ordered by: Tel. +44 (0) 1733 361149; E-mail: colinct@tiscali.co.uk or on-line at https://www.policypublications.co.uk/the_knowledge_entrepreneur.php
Prof. Colin Coulson-Thomas is an active consultant and Process Vision Holder of major national and international change and transformation projects, and an experienced chairman of award winning companies. He has reviewed the processes and practices of over 60 companies and helped over 90 boards to improve board and corporate performance. Tel: +44 (0) 1733 361149; Email: colinct@tiscali.co.uk or https://www.coulson-thomas.com/
