Competing in the Knowledge Economy : The Knowledge Value Chain (KVC)

More ideas from the SCIP09 conference in Chicago…

I’ve worked a lot during my career with business-to-business publishing and information services clients—and consider myself in that business as well.  There are basically two business models for this kind of information—customized and syndicated.

Customized information is that which is developed—often at great effort and expense—and which is highly tailored to the needs of a very small audience or number of “users”.  A consultant’s report is a good example.

Syndicated information is that which is developed—again often at great effort and expense—but that is intended to meet the needs of a much wider audience.  A magazine or a mass-appeal web site are good examples. Read the rest of this entry »

Ideas from the SCIP09 Conference in Chicago…

When I was in business school, my dean (William Donaldson—who earlier in his career had founded the brokerage firm Donaldson, Lufkin, and Jenrette) had several homespun sayings that would guide those of us who knew him.  One of these was “You have two ears and one mouth—you can’t use them both at the same time, and you’d be wise to use them in that proportion.”

Listen more, talk less—what a concept!  When you get to be an “expert” in something, it’s too easy to talk without listening, thereby limiting your flow of new information to your own direct experiences.

Last week I attended the annual conference of the Society of Competitive Intelligence Professionals in Chicago.  I had given lectures and workshops for many of their recent conferences, but this time my role was different.  This time, instead of being the “expert”, my job was to moderate and guide a discussion (”Active Dialog”) of the intelligence practitioners in the room.

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“The death of one company is a tragedy; the death of one million is a statistic.”

Originally said of catastrophic human events, so it is too with “The Economy”.  It’s too easy to get lost in the quantified abstractions of the aggregate, and thereby lose focus on the realities that drive individual business enterprises.

If “The Economy” exists in any sense as an economic reality that can be acted on, it’s only in centrally-planned top-down economies.  On the other hand, in a free-market, unplanned economy, “the economy” is the sum of the activity of individual firms.  Firms in turn are the sum of individual businesses or products.  Product markets are aggregations of individual customers.  Customers are aggregations of individual transactions.  Up to that point, it’s like fractal geometry—there’s always another level deeper you can go.

So while it’s sometimes a useful shorthand to say the economy is expanding, contracting, or WHATEVER—it’s really a gross oversimplification.  As such it blurs the actual reality, and causes unintended consequences—for example, lulling us into a sense that all is hopeless until “the economy comes back.”   It’s almost as if we ascribe supernatural powers to this abstraction.

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Now the tough get going.  The economy will come back—not because it decides to come back, but because we together make it come back.  How long this will take to happen, no one can say for sure.

This much is clear:  silly season is over.  Things like having not one, but two places on your block that serve expensive coffee that takes a long time to make, are over.  Things like getting funding for business models that are “cool”, but that have no hope of ever making money, are over.

Value creation doesn’t stop in a recessionary economy like this one—but it does change, sometimes dramatically and very fast.  Value can migrate from one economic sector another.  This is because each “value chain” interacts, and displacements in one—like you lost your job—cause displacements in another—like cutting out the overpriced coffee. Read the rest of this entry »

In my last post “Our radar has failed”, I offered the view that the current financial crisis is actually more than that—it’s a crisis in the ways we use information to make business decisions.  We’ve obviously come to another “Where do we go from here?” moment.

So, where DO we go from here?

I’ve identified four guiding principles that I believe frame a way to move ahead in the ways we use information to manage our economy and society going forward.  These are Vigilance, Integrity, Transparency, and Accountability.  (Each is first defined below using Merriam-Webster’s Collegiate Dictionary.)

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Once again, our radar has failed.

The current financial meltdown is much more than a serious financial crisis. It’s even more than a crisis of confidence. It’s no less than a fundamental abuse of information and its pivotal role in our economy.

When our economy started in pre-historic times, we bartered for goods and services. Then money was invented—first stones, then metal coins, then paper—and finally, ledger entries. No less an expert than Walter Wriston (then president of Citibank) said over twenty years ago that the fundamental financial resource is now information.

Modern information technology long ago dwarfed earlier record-keeping methods. A typical teenager now carries with her several times the amount of data contained in the Encyclopedia Britannica. And these technologies gave us assurance that, to paraphrase the Who, “We could see for miles and miles.” With modern technology and record keeping methods, the story went, we could undertake transactions of far greater scale, scope, and complexity than ever before. And the “systems” would warn us if anything was wrong.

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I recently conducted a KVC Workshop for intelligence producers at SCIP08’s international convention in San Diego.  During the workshop I surveyed them about their biggest obstacles and problems in corporate intelligence.  We’ve been collecting and analyzing this kind of data now for several years—I call it the Intelligence Points of Pain (IPoP) database.

NEWS FLASH: Intelligence problems and challenges are remarkably similar across different organizations, in different industries, in different countries. Even as I compare Workshop results from different years, I find the results amazingly consistent.

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It was a weekday afternoon in the fall of 2007.  Though sitting at my desk, I was speaking “virtually” with about a hundred other people around the world who share my interest in corporate intelligence.  Specifically, I was midway through giving a live webinar (hosted by Aurora) on the Knowledge Value Chain®.

A chat message came through on the screen sidebar from the head of intelligence at a large US company.  She said her company was planning an all-day intelligence event, and they wanted to order one hundred copies of my KVC Workbook as a discussion guide for attendees.  This was the largest single order for the book to that point, on that basis I counted the webinar as a huge success.  We left it that she’d call back the following week to firm up the order details.

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Here’s an excerpt from my chapter in the new book Starting a CI Function (SCIP 2008.)

In each organization, the specific mission for intelligence, and the intelligence plan that supports that mission, will vary.  However, a set of “information deficiencies” that is strikingly similar across many organizations, across all industries, remains.  These include:

• There is too much information “out there”, and often it’s hard to find. According to the search engine Technorati, the number of blogs is now over 93 million-with 175,000 being added each day. Not all of these have business value—but a surprising number do, and should be on your intelligence “radar screen”. And it’s only going to get worse. A recent study (”How Much Information?  2003“, School of Information, University of California, Berkeley) found that worldwide information production increased by 30 percent each year between 1999 and 2002. Read the rest of this entry »

It’s here—the shiny (really!) new version 3.2 Knowledge Value Chain Workbook.  Our thanks to the TKA team and partners who made this happen.  Workbook designer John (”The Great”) Fantini and printer Craig (”On-Time”) Pace of Spectragraphic Inc. did yeoman service in getting this edition ready.  Mike (”Pool Boy”) Powell made extensive editorial comments, as did KVC “users” Kathy Walsh of Purdue Pharma and Stephen Lippman of Merrill Lynch.

For those of you with version 3.1, most of the changes are editorial, there is little new content this time (hence its “dot” number).

We have now shipped the book worldwide—most recently to Estonia and Korea—and welcome any feedback from those of you who have it or are using it.

 To order, click here.