As of January, 2010, the IC Knowledge Center has become a global community aimed at creating open resources and conversations about IC. This community is located at: www.icknowledgecenter.com. Please join the community!
If you are interested, here’s the story of how this transition came about: The site began as my personal bibliography when I became interested in the field of intangible capital. In early 2006, I created a static website that included my favorite resources. Every month, I would add a handful of new resources and send out a e-newsletter announcing these new additions.
In 2008, I realized that what I had been doing was blogging without the benefit and flexibility of a blog platform. So I moved all the content to a blog created in WordPress. Two colleagues, Henrik Martin and Peder Hofman-Bang, joined in on the posting.
As the world moved through a deep recession, I became more and more militant about the need for improved ICManagement. We now live in the knowledge era and the serious global and national challenges we face will only be resolved through the better use knowledge intangibles.
Along the way, I have gotten to know a lot of other people that feel the way that I do. That’s why I made the move in early 2010 of taking the IC Knowledge Center to the next level of communication and create:
A network of smart people who believe in the importance of IC and finding better ways to manage, measure and leverage IC for profit and social benefit.
I hope you will join us and contribute to our shared vision to reshape business and the world by making every person, every business and every community smarter and more productive. You can start by joining our network, sharing your favorite resources and participating (or starting!) a discussion. Together, we can build a better world using the knowledge that already exists in our communities.
The next step is yet to come: a set of open source tools and methodologies to facilitate ICManagement…
This is important work and I hope that you will join us in this exciting community!
Thanks to Ken Jarboe at the Athena Alliance for letting us know about the publication of the report of the conference hosted last year (2008) by the National Academies in Washington DC entitled Intangible Assets: Measuring and Enhancing Their Contribution to Corporate Value and Economic Growth: Summary of a Workshop.
Back at the time, I wrote a series of posts about the event at Hybrid Vigor (scroll down to July). But please note that the links in those posts don’t work anymore. The presentations are here (scroll down to June).
My favorite presentation was by Irving Wladawsky-Berger of IBM and MIT on The Transition from the Industrial to the Knowledge Economy for its perspective on the underlying changes in technologies that drove the transition and will drive future change. He sees moves in technology as:
- From tangible to intangible
- From automating the back office to automating market-facing systems
- From machines/products to people and services
Lots of other great presentations there too. Enjoy–can’t think of a better way to frame the new year!
Steve Tobak echoes the feeling that I often have when the media or any number of corporate stakeholders are surprised by poor behavior of their leaders in Leaders Will Start Acting Like Adults When We Do.
He is basically saying that we cannot expect miracles from leaders because they are as human as any of us. But, as I explained in this post on Tiger Woods and Intangibles, I think that the view of leadership in today’s corporations is distorted by the lack of information about intangible capital.
Corporations invest more heavily in intangibles than they do in tangibles. Corporate value and performance is more dependent on intangibles than on tangibles. But corporations do not measure intangibles with any kind of consistency or rigor. Managers and leaders end up relying on their gut feel for how the intangible side of business is working.
That means that corporate leaders become a kind of priest class with special knowledge that no one else has. They are given more power than they should have because of this information gap. Until corporate stakeholders demand better information, that’s the way that it is going to stay.
What is really the difference between the Professor Chen Yu invention: “Consumption Capital”, and what we in the Intellectual Capital world like to refer to as Customer Capital?
One of multiple possible answers is that it is a matter of macro vs. micro; that consumption capital comes from the need to make the people of a whole nation become bigger consumers, no matter the supplier.
Whereas Customer Capital is more about creating mutual beneficial relationships between me as a supplier and my customers. Sure, I want them to consume more, but only from my company.
Maybe you can argue that it is push vs. pull; transaction vs. interaction and so on.
Anyway, I have a more positive view of the Consumption Capital idea after I have gained more knowledge about the Chinese economy – not only by reading papers from the west, but hearing about it first hand from Chinese government officials and economists. Stimulating consumption is key to sustain growth. But the current stimulation package has to be altered from currently creating vast surpluses to increasing salaries, creating more efficient enterprises etc.
As one distinguished army General said in his talk: we all know how to spend money – once we have money.
Just came upon a full text posting of a 2008 Emerald article The Evolving Research on Intellectual Capital by Tan, Plowman and Hancock at UWA Business School, The University of Western Australia. For anyone new to the field, this is a good start. Also fun for experienced IC’ers to see it all in one place.
Nevertheless, I still believe the most important works are yet to be written–as we see how these theories get put to work inside companies.
The company Relation Capital Partners has just been established, but the people behind the firm have had a long time passion for CR; or should I say CSR; or perhaps I should call it sustainability challenges; or wait a minute, I mean corporate citizenship really…
OK. You get the point – how should this company, in simple terms, describe the nature of its business?
I have been through this before; it is a constant battle to keep things succinct when you persist to get into businesses that relates to complicated concepts, invented by some smart consultants or academics: Customer Driven Enterprising, Corporate Social Responsibility, Intellectual Capital Management etc. Just the names of my games or really my personal business nature?
Anyway, why don’t you help out? The customers are very happy with the company’s services, but e.g. the web site need to attract more stakeholders, through a simple, direct and information language. Feel free to give feedback directly to the CEO, Tomas Zimmermann.
It seems as if it is often easy to criticize corporate communication as way too complex. Especially if it is not your own communication.
So, how often do you question the stickiness factor of your own communication skills?
Yesterday, I had an epiphany over a Latte and a Swedish cinnamon roll (called ”Kanelbulle”, but that is entirely besides the point). The friend I was meeting with had just joined a small management consultancy, and we had an interesting discussion about why most management consultancies seem to stay small.
Our conclusion was that their biggest problem is the lack of shared structural capital. As a small firm you do not have the resources to spend on continuously building and maintaining your structural capital, such as common processes, CRM-systems, knowledge management tools and case data-bases. And then you remain a small, people-dependent, growth-challenged company for sure.
On top of that, if your compensation scheme is “eat what you kill” (every woman and man for themselves) rather than “utopian communism” (we’re all in this together, let’s share equally), why SHOULD you share your hard-earned knowledge with your colleagues?
To make your company grow, you need well-honed structural capital. And to achieve that, you need incentive-schemes that are geared towards just that. Have you seen any particular good examples of this (and no, I do not mean Joseph Stalin)?
One of my favorite writers on strategy, Henry Mintzberg, set off a firestorm by questioning the logic behind current compensation approaches in the U.S. in No More Executive Bonuses. He cited three faulty assumptions:
- A company’s health is represented by its financial measures alone–even better, by just the price of its stock
- Performance measures, whether short or long term, represent the true strength of the company
- The CEO, with a few other senior executives is primarily responsible for the company’s performance
Add to this the data shared in a post at the Corporate Library Just the Facts, Courtesy of David Weidner that the Wall Street Bonus pool estimate for 2009 was $140 billion compared with the combined budget deficit for the 50 states of $142 billion. And that’s just Wall Street, not the rest of the economy.
Compensation and definitions of success in our market are focusing on financial numbers that have less and less meaning. If accountants kept track of the total value of corporations, the average company today would have 50% of its value in goodwill, that is, unidentified intangibles. This huge gap in corporate reporting makes it impossible to understand the long-term prospects of a company.
Yet intangible capital is the key to competitive advantage and performance. Ignoring it has led us to the short term thinking about shareholder value that allows huge amounts to be paid out of companies that are not building for the future.
The key word for successfully selling Intellectual Capital Management (ICM) to Japanese companies seems to be transformation.
While the economic growth has been 400% in China since the beginning of the decade, it has merely been 13% in Japan (according to GDP that is, which we as intellectual capitalists know is a more or less bogus statistic…). Still the Japanese GDP per capita is higher than the U.S., but the point is really that many large, traditional Japanese companies have been oblivious to change.
A common joke here is that the major reason for someone being appointed CEO is that he (yes, he) has proved to be a major gatekeeper of the company’s ancient business traditions.
Now, some giants are waking up. And there are potentially big business to be made if you can get a foothold in the door of any of the top five executives in those corporations. Actcell now has a toe in there, and its consultants are gradually moving in.
The key? Transformation through Intellectual Capital Management – the leadership for the 21st century. Over the years I think many of us have noticed that when Japanese companies go for something, it is for a good reason.
So, are you just going to sit around and wait for the outcome?
Or, are you going to run along?
I posted recently on the Athena Alliance paper on the intangible finance market in the U.S.
This week, IAM Magazine had an interesting post China Emerges as World Leader in IP Finance. What’s interesting is the focus on small and medium-sized enterprises (SME’s). While this appears to be a governmental program to support business, the focus on intangibles as security for business loans is significant for the global intangibles community.