Two vignettes

To illustrate the principles of value creation, consider these two hypothetical vignettes from everyday life.

Vignette 1 – A Visit to the Doctor

You pay a non-routine visit to your doctor.  The doctor’s first question is, “What kind of pills would you like today?”

Your reaction?  You’re shocked at the incompetence, and look for another doctor.  Any doctor that prescribes medicines upon request is little more than a very expensive vending machine.  We expect the doctor’s first question to be something more like, “What is bothering you today?”

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CORRECTIONS to the KVC Workbook (Version 3.1)

Sharp readers of the KVC Workbook (Version 3.1) have spotted several typos:

  • Page 3, right column, 1st paragraph – change “necessary” to “necessarily”
  • Page 5, 1st line – change “rather” to “father”
  • Page 5, right column, 2nd paragraph – after “more”, insert “than”
  • Page 6, right column, 3rd paragraph, 6th line – change “the” to “to”
  • Page 7, 1st paragraph – change first “who” to “which”, and “their” to “its”
  • Page 10, 4th paragraph – after “of” insert “us”
  • Page 12, 2nd paragraph – change the second “do” to “conduct”
  • Page 23, 2nd paragraph – after “routinely” drop “and”
  • Page 28, 2nd paragraph, 2nd line – drop “we”
  • Page 30, 2nd line – change “know” to “known”
  • Page 32, 2nd paragraph, last line – after “$50,000” insert “car”
  • Page 40, 4th paragraph – after “company” insert “has taken”
  • Page 42, last paragraph – change “some” to “an”
  • Page 44, 3rd paragraph – drop the second “that”
  • Page 46, 1st paragraph – change “diagnosis” to “diagnose”
  • Page 62, 3rd paragraph – change “an” to “and”
  • Page 66, 2nd paragraph – drop second “you”
  • Page 74, 1st paragraph – after “way” insert “as”
  • Page 74, 3rd paragraph – change the second “your” to “you”
  • Page 79, slide fourth bullet – after “possible” insert “to”

Thanks, you know who you are!

 All of these (and more) changes are made in the new Version 3.2.

TKA in new offices

The Knowledge Agency has moved!  After a successful five-year run on Fifth Avenue, we’ve moved west to the Hudson River waterfront.

Effective November 1, 2007, TKA’s  address is:

The Knowledge Agency®

548 West 28th Street

New York, NY 10001, USA

That’s in the Hudson Yards area the New York Times recently profiled as one of the fastest-developing business centers in New York.  Several major art galleries, publishing, and technology firms have already relocated from midtown to here.  Soon Ogilvy and Mather, Morgan Stanley, News Corporation, and Condé Nast are said to be moving their headquarters here.  We have some interesting neighbors!

We’re also in the process of modernizing  and upgrading our phone and Internet systems based on fiber optic T1 technology.  Phone numbers stay the same.

KVC Workbook available

September 6, 2007, NEW YORK—The Knowledge Agency® (TKA) today announced the availability of The Knowledge Value Chain® (KVC) Workbook, Version 3.1.  “This marks the first time we’ve made our workbook available separately from our clinics and workshops,” said Tim Powell, TKA Managing Director and developer of the KVC model.  “In order to get the full benefits of the KVC, you need to participate in a KVC Clinic or public workshop.  However, the Workbook itself provides a good deal of value, and you can use it to begin to implement some of the KVC principles yourself.”

First introduced in 1996, the KVC model has been taught in universities, business clinics, and workshops worldwide since that time.  Version 3.1 introduces the KVC ScorecardTM, a self-scoring evaluation system for the effectiveness of intelligence and knowledge processes and products.

The KVC Workbook is available only directly from TKA.  For a limited time, we are offering introductory pricing of US$100 plus shipping.  To reserve your copy, use the “Contact” button at the top of the page.  We’ll contact you back to complete the order.  We accept American Express and bank wires.

Also announced was an upgrade path for owners of earlier versions of the workbook.  Version 3.0 owners may upgrade to Version 3.1 for US$65.  Owners of earlier versions should contact TKA for pricing on those upgrades.

KVC Clinic available

September 4, 2007, NEW YORK—The Knowledge Agency® (TKA) today announced the availability of The Knowledge Value Chain® (KVC) ClinicTM, version 3.1.  TKA Managing Director Tim Powell said, “The KVC Clinic gives us the chance to work directly with companies to bring the benefits of the KVC model into companies to solve their intelligence and knowledge challenges.”

First introduced in 1996, the KVC model has been taught in universities, clinics, and workshops worldwide since that time.  Version 3.1 introduces the KVC ScorecardTM, a checklist and self-scoring evaluation system for the effectiveness of intelligence and knowledge processes and products.

Contact TKA for clinic pricing and availability at +

The Knowledge Value Chain and The Knowledge Agency are registered U.S. trademarks of the TW Powell Co. Inc.

My father’s footsteps

When I started my own business in 1991, my late father showed a more keen interest in my career than he had previously. He had gone into business for himself late in his own career (as a business writer), and I always found his insights helpful. I always gave him whatever papers and books on intelligence I had written, and he always made an effort to read them, and respond “intelligently”.

But one day, he confirmed what I already suspected by asking, “Tim, I’m still not really sure what you, your company, and your colleagues do for a living. Can you explain it in ways that the rest of us can understand?”

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Beyond eyes and ears

It is said that intelligence is the eyes and ears of the enterprise, and this is a useful analogy in some respects. In the obvious sense, through our eyes and ears we take in sensations that in effect are the “data collection” functions of the human body.

These sight and sound sensations would just be a jumbled mass of nerve cells firing without some kind of sense-making to put them into order. Studies have shown that a newborn baby takes in the same level of sensations that an adult does—but has not “learned” what the sensations mean. (One developmental psychologist called the resulting sensory chaos a “blooming, buzzing confusion.”) As a result, a baby can’t “see” clearly—but only because its sense-making capabilities are not yet developed.

The same is true in organizations. Data comes at an organization continually at a fast and furious rate. Without some kind of sense-making function, it all seems like that same “blooming, buzzing confusion”. A good intelligence function serves as that sense-making function—in addition to being eyes and ears. The KVC model can be used as a template in developing the intelligence function beyond mere data collection, beyond mere analysis—into a real-time strategic direction-finder.

Excerpt from the Introduction to The Knowledge Value Chain Workbook by T.W. Powell.

Gravity and friction

Why are some resources (in the US, at least) managed by government, while others are managed by the private sector (that is, business)?  Simply put, some resources are public by nature—roads, for example, and the armed services—and are therefore managed collectively.  Other resources—manufacturing, for example—are best run by private enterprise.

Intelligence is conducted both in the public sector (by the government), and in by private sector (by businesses and other private organizations.)  Intelligence in the public and private sectors, though similar in many respects, operates under very different sets of “value” assumptions and rules, respectively.  In the public sector, it is the case that everything has been mandated or otherwise agreed to be in the public, collective benefit.  You must do it, it’s the law.  Although fiscal responsibility is certainly important, it is not the overriding goal of government to turn a profit.

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It’s all about the benefits


The late Theodore Levitt, professor of marketing at Harvard Business School, was a champion of customer benefits as the benchmark for value in marketing. As he memorably put it, customers don’t really want a drill—they want a hole.

That single insight fundamentally changes the way you develop and position products.

The same could be said of intelligence. Intelligence users don’t really want more information to read (or listen to) and discuss. They want to be more competitive—to have more sales, higher margins, a higher stock price, and so on. Competitiveness is the end, intelligence is but a means to that end. Intelligence derived without concern for the value proposition that it is serving will almost necessary not be value-focused, and as a result will not achieve the returns it potentially could achieve.

Excerpt from the Introduction to The Knowledge Value Chain Workbook by T.W. Powell.

A rose by any other name

I didn’t start out to become a business researcher (though, in hindsight, that was the first professional role I was paid for).  I started out to become a physician, and completed the four year-long courses needed to enter medical school—inorganic chemistry, organic chemistry, physics, and biology.  This took much of my time, energy, and waking thoughts for two years in college.  And though I later decided not to pursue medicine as a career, it was not time wasted.  I often find myself using scientific thinking, or referring by analogy to some principle of science to understand a business problem.

Modern science is based on the scientific method—hypotheses are developed, then tested for validity in the real world.  Eventually, some become known as theories.  Others are so time-tested and reliably true that they are known as laws.  The scientific method is a specialized kind of knowledge value chain.

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    COMPETING IN THE KNOWLEDGE ECONOMY is written by Timothy Powell, an independent researcher and consultant in knowledge strategy. Tim is president of The Knowledge Agency® (TKA) and serves on the faculty of Columbia University's Information and Knowledge Strategy (IKNS) graduate program.


    "During my more than three decades in business, I have served more than 100 organizations, ranging from Fortune 500s to government agencies to start-ups. I document my observations here with the intention that they may help you achieve your goals, both professional and personal.

    "These are my opinions, offered for your information only. They are not intended to substitute for professional advice."


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    COMPETING IN THE KNOWLEDGE ECONOMY is sponsored by the Knowledge Value Chain® (KVC), a methodology that increases the value and ROI of Data, Information, Knowledge, and Intelligence.

    The contents herein are original, except where otherwise noted. All original contents are Copyright © TW Powell Co. All rights reserved.

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    E SCIENTIA COPIA. Knowledge is the Engine of Value.