|"The Search for Corporate Longitude" was the theme of Leif Edvinsson’s
keynote address at the Knowledge Management 2001 conference held April
34 in London’s Hammersmith Novotel. Edvinsson is a professor of knowledge
economics at Lund University in Sweden. He spoke at the start of the second
day of this fourth annual event, which was organized by Bizmedia, Ltd.
(under license from Learned Information Europe, Ltd.).
The conference attracted 108 delegates, 1,550 visitors, and 34 exhibitors.
The 1999 event had 33 exhibitors, so the number of vendors who don the
knowledge management (KM) mantle is evidently holding steady. However,
2 years ago there were 145 delegates to the conference and 1,875 visitors
to the exhibition (a decrease of 34 percent and 17 percent, respectively).
Given that the event’s organizers did an excellent and professional
job, would it be right to say, then, that the knowledge management market
is shrinking? Has the concept behind KM—namely that of pumping an organization’s
knowledge more efficiently around its veins in order that it be more effective
and (in the private sector at least) more competitive—lost its attraction
That knowledge management could regain some of the "big idea" luster
it showed in the first year of this event was suggested in Edvinsson’s
talk. He took his cue from Dava Sobel’s book Longitude. This chronicles
the travails of John Harrison, an 18th-century clockmaker whose
success in determining an east-west position at sea was ignored for 70
years in favor of the British scientific establishment’s astronomical pseudo-solutions
to the problem.
Edvinsson argued that our lack of a means to measure corporate knowledge
puts business in a similar position to that of shipping in the 18th
century. Lives were lost at sea then, just as human talent goes unrecognized
today in organizations whose only means of measurement are financial—i.e.,
the balance sheet, the profit-and-loss account, and (for listed companies)
Edvinsson originated the intellectual capital reporting system at Skandia,
the Swedish insurance and financial services company. Like his confrere,
Karl Erik Sveiby, Edvinsson is guided by a tripartite understanding of
intellectual capital as being composed of human capital (the knowledge
and expertise held by an organization’s individual members), structural
capital (the knowledge embedded in internal structures), and customer capital
(the intangible assets a company derives from its relations with its customers).
It is, by now, a familiar model and line of thinking, but Edvinsson
livened it up with pithy phrases ("leaders create energies, managers steal
energy") and striking images (including one of an upside-down tree—behold
the value in the roots). His exhortations to knowledge workers to become
artists with icons, not job titles, on our business cards were beguiling.
And how interesting it was to learn that the Swedish word for business
means "nourishment for life," and that 20 percent of Swedish workers choose
(positively) to work part time.
And yet, in light of the meltdown of Internet and IT stocks in the world’s
stock markets, and the economic slowdown in the U.S., it all sounded naive.
Now, one could say that this just proves Edvinsson’s point that corporate
analysts are lost in fog akin to the fogs that marooned 18th-century
sailors. However, such an argument seems disreputable when one recalls
how so much of the propaganda for the significance of intellectual capital
was based precisely on the gap between the book value and stock market
value attributed to companies.
At the conference, there seemed to be a lack of both a sense of currency
and of the present commercial reality. Much of what was said could have
been said last year or the year before.
Elizabeth Lank, who also addressed the issue of measurement in her talk
"If You Can’t Measure It, You Can’t Manage It," told me that "for the presenters
at KM conferences ... a certain sense of déjà vu is creeping
in, with many of the same issues reappearing on the agenda of different
"However," she continued, "it is interesting to note that there are
still customers for these conferences, still fairly sizable audiences as
at KM 2001, who are interested in learning from those a year or two ahead
of them—proof that the knowledge management movement is more than a brief
"However, knowledge management is increasingly losing its special label
and being integrated in with e-enabling, managing networked organizations,
creating communities of practice—basically just managing 21st-century
organizations. That is a healthy development."
Many commentators on the KM scene have been declaring and applauding
this seeming diffusion of knowledge management into "21st-century
business management" over the last year or so, but are there not losses
from that as well as gains? Hasn’tthe term knowledge management joined
together a set of cultural and technologicalpractices that have a substantive
weight of their own, distinctive within business management? KM, surely,
involves real meat-and-bone stuff—from data mining, through managing a
company’s patent portfolio to makemore money, to knowledge transfer through
storytelling—that makes very distinctive lumps in the soup of general management.
It seemed to me, in the fourth year of attending, that there are at
least two events struggling to be born here. One is a high-level business
strategy conference that would subject, say, complexity theory or intellectual
asset measurement to rigorous examination. And the other is a conference
and exhibition that would meet the very practical needs of strategic researchers
and business analysts in, mainly, professional services firms.
Clare Hart, CEO of Factiva, clearly pitched her talk to just such an
audience, although her favored term, "competitive intelligence professionals,"
is not as common a job title in the U.K. as it is in North America. She
stressed how Factiva’s technology is more and more enabling the automation
of competitor and customer analysis, thus freeing up competitive intelligence
specialists to play a role that adds more commercial value through higher
level human analysis. Kobi Korsah, technology advocate at Autonomy Systems,
made a similar argument for the benefits of the automatic application of
categories to information. Both talks were sales pitches, of course, but
it wasinteresting that both were almost defining into existence a stratum
of strategic researchers liberated from the grind of too much information
Victor Newman, chief learning officer at the Pfizer Research University
(Europe), entitled his talk "Why You Should Just Say ‘No’ to KM Projects
(Because All Projects Are KM Projects)." He told me that he noted a sense
of fatigue at the event. "I think that this time the conference felt like
it was an annex to the exhibition. For my part, I tried to pick up and
involve the audience and got some good questions around de-bulling KM."
Indeed he did. Most memorable for me was his recollection of a comment
made by Ronald Reagan to a high-powered economics adviser. "Son," Reagan
said to the appalled academic, "keep your briefings to three points, preferably
in cartoon form.And if they rhyme I might remember them." Good advice,
Newman stressed, for any knowledge professional charged with briefing a
The Big Debate
Edward Truch, director of the knowledge management forum at Henley
ManagementCollege, and Dave Snowden, director of the IBM Institute of Knowledge
Management for Europe, the Middle East, and Africa, participated in a debate
titled "Is This the Death of Traditional KM Consultancy?"The debate got
the conference off to a stimulating start, and revolved around Snowden’s
antipathy to traditional analytical consultancy. In his view, this ultimately
derives from Frederick Taylor’s school of scientific management, which
was developed in tandem with the assembly line in the 1920s, and is based
on the conception of the working man as a "trained gorilla." Snowden instead
vaunts more organic modes of consultancy, based on a respect for an organization
as a complex ecosystem, and working with clients to elicit what they know
in order toaddress and solve their own business problems. A light touch
on the tiller is required in this kind of management, he argued—in nice
keeping with Edvinsson’s longitude touchstone. (Indeed Snowden told me
he uses Longitude in his consultancy work for IBM Global Services.)
Snowden told me after the event that he thought the debate form in which
his contribution was cast did serve to enliven the conference.
KM and Public Policy
Conference chair Ron Young, CEO and founder of Knowledge Associates,
and Marc Auckland, chief knowledge officer and head of the BT (British
Telecom) Academy, both tried to demonstrate the relevance of knowledge
management issues to the wider realities of current public policy and the
political economy. In both cases, the connection was to the European Union
Young discussed a European Union-funded KM research and development
project called Know-Net, which is focused on delivering a knowledge management
asset methodology. Auckland took the audience through a government lobbying
initiative involving 47 European businesses (organized in the European
Round Table), and trained on the question of how the EU can compete more
effectively in a global knowledge-based economy.
Auckland pinpointed some contrasts between Europe and the U.S. that
were revealed by the project’s research. Europeans are better, he said,
at learning from experience and are used to complex markets (in terms of
law and language). Americans, however, enjoy the advantage of being better
at collaboration. And the U.S. is miles ahead in patent generation, "which
is a key index of how successfully a country is leveraging its knowledge,"
he said in conclusion.
Auckland admitted his presentation was at a "level of 40,000 feet" and
that altitude can make one a bit giddy. Whether European governments will
take his Round Table’s recommendations for promoting the knowledge economy
on board remains to be seen. One suspects the exigencies of the real economy
will prove too strong.
Brian McKenna is a freelance business journalist specializing in
the electronic publishing industry, knowledge management issues, and European
public policy as it relates to IT and the Internet. His e-mail address