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The Triple Knowledge Lens:
Intangible Performance for Knowledge Innovation Zones
Founder and CEO
ENTOVATION International Ltd.
Bryan Elliot Davis
President
The Kaieteur Institute
“Creation
of a dynamic world community
in which the peoples of every nation
will be able to realise their potentialities for peace."
- Henry Morganthau, Opening Address
Bretton Woods Conference (July, 1944)
Architects of the 21st century recognize that intellectual wealth is the economic engine for prosperity. Leaders are ushering in an unparalleled era of collaborative advantage - beyond competition. Success requires understanding knowledge performance indicators, networked structures, knowledge roles and skills, innovation processes and collaborative technologies built on good research and prototyping. Innovation initiatives abound, some more successful than others.
We have aggregated hundreds of these knowledge-driven activities under the rubric of Knowledge Innovation Zones. These entities are enabling new forms of enterprise, collaboration, cooperation, research and development, knowledge sharing and commercialization of ideas between the private sector, government, and academia. A Knowledge Innovation Zone, referenced now as a KIZ, is a geographic region, a company or industry, or a community of practice within which knowledge flows from its origin to the point of need or opportunity.[1]
These KIZ, modeled after free trade zones and focusing on knowledge creation, flow and application, are rapidly expanding the worldwide agenda for knowledge transfer and technological innovation. A range of terms are used to describe these projects (see the emerging taxonomy): the creative city, the science city, the region of the future, the high technology knowledge corridor, the smart city and more. At their core is a shared underlying desire to exploit knowledge, and creative intellect, as a powerful engine to drive economic performance and societal development.
Within enterprises (profit and not-for-profit) and countries, leaders pursue management strategies so stakeholders and knowledge citizens derive wellness, meaning, and prosperity. Examples include the Dubai Knowledge Village, the Leiden Knowledge Cluster, the Baltic Sea Knowledge Region, the Barcelona Knowledge District 22@, Shanghai City of the Future, Hyderabad Knowledge City, or the trans-border Øresund Region linking Malmö, Sweden, and Copenhagen, Denmark – just to mention a few.
Australia to Zimbabwe, this evolution is characterized globally by multiple initiatives and significant investment, and is of more than academic interest to technology-intensive companies. Enterprises—especially those pursuing globalization and emerging markets—must look at innovation explicitly as a core process for the future of their company. We all know innovation is more than a function of R&D and creativity. It is an environment, and climate with incentives to optimize the flow of knowledge into profitable products and services. Innovation today transcends boundaries of functions, business units, sectors and geographies. It provides the platform to concentrate resources and focus knowledge into actionable opportunities.
The NEW Bottom Line
Forward-thinking enterprises have understood the full role they play in the economy and their influence on (and by) the social environment. They include this perspective in how they account their assets and results.
This foundation for Triple Bottom Line (TBL) accounting – best exemplified in the award-winning reports of Novo Nordisk, a Danish-based pharmaceutical company - was born as part of the corporate sustainability movement. There is worldwide recognition that financial metrics are insufficient to provide adequate indication of the health and well-being of a given geography or company. For hundreds of companies, this provided an opportunity to document how the financials connect with the social and environmental concerns.
Concurrently, there has been a natural evolution from the goals in the 1980’s to build government-industry-techno interactions – often resulting in the development of technopoles to make optimal utilization of resources. The 1990’s brought forth an explosion of science and technology parks to stimulate entrepreneurship and the emergence of Digital Cities as a way to optimize the application of information technology. Eventually, initiatives expanded into notions of knowledge or industry clusters and collaboratories – referenced as recently as the new UNESCO Report, ‘Toward Knowledge Societies’ in which the clear distinction if made between an information vs. a knowledge-driven activity. The 21st century has given birth to the knowledge-based economy, society and infrastructure establishing a foundation for innovation-based real-time performance.
Changes in several fundamental management parameters are have a kaleidoscopic effect on managing a company or a country. The Knowledge Era – in contrast to the Industrial or Information Eras - demands solutions that are symbiotic, collaborative and innovative in which people and communities are cultivated. ‘Impact’ is the performance measurement as opposed to ‘output’ or even ‘outcome’. Sustainability and increased quality of living or working is dependent upon the effective economies of learning, in addition to scale and scope. In short, economic strategic planning for a country or a company now requires aggressive strategies to innovate the intellectual capital.
As described in the illustration (above), there is a need for a new planning platform - beyond the TBL reporting - the foundation of sustainability reporting in the 80’s and 90’s.
After an exhaustive analysis of knowledge-driven investment and a plethora of Intellectual Capital (IC) indicators under development from various companies, academic research centers, societal organizations, our preliminary research findings indicate the evolution of the Triple Knowledge Lens (TKL). The Triple Knowledge Line is the balanced triangulation of successful and sustainable results across the knowledge-based economy (business), the knowledge-based society (people), and the knowledge-based infrastructure (organization, technology, and environment).
A new Knowledge Value Proposition has emerged as a shift from the economics of scarcity and the limited supply of material to the economics of abundance – the inexhaustible supply of knowledge. Knowledge is a resource to be created, shared and converted into products and services to benefit a stakeholder community.
There are new economic indicators of performance for the profit and non-profit sector that are described as intangible or intellectual capital. We identified a concurrent and rapid emergence of networked-based knowledge innovation zones among knowledge communities and communicities – technical and social enabling networks. There is the physical space – usually defined as infrastructure, the traditional and progressive ecological views of bricks, mortar, land and technology.
There are many multi-million and some multi-billion dollar challenges faced by leaders championing new developments in knowledge innovation zones, such as the new ‘King Abdullah Economic City’ (Saudi Arabia). Whether existing in an industrialized, transitional or developing economy, or if investors are planning Greenfield or Brownfield communities, the issues are similar. Below are some of the key questions arising from our research of current KIZ initiatives. These must be addressed should investments be successful.
Knowledge-Based Economy Concerns
·
Fulfilling the Promise
Will the project live up to expectations and will the vision for
it ultimately be realized? Will it really come to life and offer a pleasant
quality of life, and a stable and prosperous economy and political life?
·
The Attractiveness Challenge
How do you best position and promote your KIZ so that it is
attractive to people and enterprises who have the talent and funds to come and
invest -
especially when human capital and expertise and financial capital is so
footloose these days, and competition with other zones is intensifying?
· Models of Knowledge Exchange
What are the new forms of knowledge commerce – from creation to commercialization or application – that ensure highly leverages human talent locally, regionally and worldwide?
·
Foresight - Future Readiness
How do you make effective strategic plans and investment so that
your zone is well conditioned to prosper economically in the years to come in
the face of rapidly changing global conditions?
Knowledge-Based Society Concerns
· Change & Adaptation
How do you put in place the right measures to encourage people
and organizations to change and adapt to rapidly changing local
and global and technological realities?
· Internalizing A Continuous Innovation Culture & Mindset
How can you rapidly learn and take advantage of the best emerging knowledge innovation practices and policies and save time by not reinventing the wheel, and also condition your KIZ to operate in a continuous knowledge innovation mode?
· Political Risks
How do you proceed with an aggressive development path, without alienating existing centers of influence and power? And how do you also achieve grassroots support from a wide cross-section of the social spectrum? How do you avoid resistance and backlash that might impede progress?
· Knowledge Leadership challenge
How do you rapidly develop the knowledge savvy leadership that will have the smarts and experience to actually successfully carry out the vision expressed in ambitious strategic plans? Many people want to embrace the knowledge imperative, but do not understand the profound difference between old industrial economics and knowledge-based economics and markets.
Knowledge-Based Infrastructure Concerns
· The Digital Divide
How do you pursue a development path that facilitates access to technologies
such as the internet, broadband, and wireless, by all sectors of the population,
as well as allows for varied cultural and demographic needs.
· Intellectual Property Rights
How do harmonize such legal arrangements like the protection of intellectual
property with those of other jurisdictions and global organizations without
overcomplicating matters locally?
· Technology Forecasting and Assessment
How can you acquire the insights into changing technology trends so as to
make the right strategic decisions and investments, based on likely technological developments?
· Good Governance
How do you secure adequate project oversight and transparency so that well-intentioned initiatives do not become derailed? How do maintain fairness, trust in private and public institutions, along with accountability and transparency?
These are a select set of examples of challenges faced by Knowledge Innovation Zone developers, as we move forward. Answers will be invaluable.
There is a leadership race to find the best ways to concentrate and fuse talent, technology, and techniques in vital and thriving new urban and rural configurations. These new initiatives range from creating new economy districts, to establishing science technology and innovation clusters, to the development of entirely new or reborn cities and regions. Industries are being reconfigured and collective problem-solving has become the norm.
In the plans of cities such as Barcelona, Melbourne, Montreal, and Manchester, as well as the Aboriginal communities such as Desert Knowledge Australia, we find variations on the KIZ theme. Thriving hubs of interaction — smart, connected, highly educated, creative, livable, safe, healthy, and attractive to talented people and investors. Properly constructed, managed and evolved, the KIZ provides a superb vehicle for stakeholder innovation.
New Indicators
Knowledge-focused research dates back to the mid-1980’s when experts were analyzing why companies weren’t achieving bottom-line results with their significant investments in IT. This technology paradox was later labeled the “productivity paradox”, inferring that output to input is a multivariable, not a linear relation. In 1994 the National Research Council discovered IT only has value if surrounded by appropriate policy, strategy, talented and committed people and sound organizational relationships. The Council Report went on to note that the management of
intellectual capital may be a major factor in who survives.
In the new trilogy – Knowledge Economics, Laws of Knowledge Dynamics for managing intangible and intellectual value have emerged to address this paradox:
- Knowledge multiplies when shared.
- Innovation value is created when knowledge moves from origin to of highest need.
- Collaboration for mutual leverage provides optimal utilization of tangible and intangible resources.
While not always explicitly recognized, these Laws drive and govern the foundation of efforts to achieve stakeholder sustainability and prosperity.
After analysis of metrics emerging from the OECD, The World Bank, the UN and individual nations, we can classify an assessment schema that is consistent with the Triple Knowledge Lens:
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Knowledge Innovation Zones
Triple Knowledge Line Model |
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Knowledge Economy & Knowledge Business Indicators |
Knowledge Society, Community, & Culture Indicators |
Knowledge Organization, Infrastructure, & Environment |
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Wealth in Intellectual Capital Index (WICI) = (WHCI+WRCI+WSCI) |
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Wealth in Human Capital Index (WHCI) |
Wealth in Relationship Capital Index (WRCI) |
Wealth in Structural Capital Index (WSCI) |
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Knowledge-Based Economy Strength Index (KBESI) |
Population Knowledge Motivation Index (PKMI) |
Knowledge Enabling Technology Index (KETI) |
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Knowledge Markets Maturity Index (KMMI) |
Creative Affinity Index |
Knowledge Ecologies Index |
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Knowledge Based Business Innovations Index ( KBBII) |
Knowledge Stakeholder Interactions Innovations Index (KSIII) |
Principles, Policies, Practices, Processes, Innovations Index (7PII) |
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Key Performance Indices |
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For the past ten years we have been tracking more than a hundred initiatives in over forty countries that exemplify this new mindset. KIZ initiatives demonstrate a renewed interest in our relationship with the environment, the ecology of management systems and enterprise roles and responsibility. There is a sea change from the focus on limited resources, whether financial, human, or technological. Knowledge is the renewable asset, and innovation is how we put knowledge to work. The evolution has been charted from technopoles into science and technology parks, digital cities and collaboratories of investment. Now we see the promise of real-time innovation building connection and contactivity among stakeholders who share a common language and vision.
Thus rules of successful engagement in this innovation frontier are changing. Old rules do not apply, and the new ones are being invented. To chart a profitable course, the KIZ provides the framework to monitor trends such as networking on social and technological levels, interdependence, diversity, the e-Economy, intangible value and intellectual capital, the war for talent, virtualization of markets, enhanced visualization and collaboration technologies, and governance transparency.
Insight into our understanding is gained by viewing the Global Knowledge Zone Map - http://www.inthekzone.com - with hotlinks to initiatives under development, comparative rankings, emerging principles, conferences and symposia, as well as recommended readings. There is now a critical mass of resource material and practice to produce a definitive report on the state-of-the-art and identify future trends. Modern management standards may rely upon the expertise resident in the R&D community and other stakeholders in the innovation community.
7P Blueprint – Knowledge Recipe for Implementation
Knowledge is valuable; but knowledge operationalized is more valuable.
We’ve determined that there are several critical elements in this strategy of building or innovating geographic, industrial or societal initiatives that would build innovation strategies conducive to the knowledge economy.
There are trends and drivers influencing effective management in the Knowledge Economy. These need to be first considered as Platform for planning. Second, the Principles of the Knowledge Economy are emerging and any plans need to consider which have implications for their enterprise or country.
Integral to the process is the impetus for innovation and managing the process – which is not the norm. How many companies, academic organizations, government agencies, NGO’s, or societal organizations have a chief innovation officer? Further, how many have a systematic process in place to move good ideas – from wherever they originate – through the process in ways that effectively incubate new products and services? In Egypt, for example, a project that is funded by USAID has managed to develop a common language, culture and vision resulting in projects submitted for funding.
In this Design Phase, a foundation is provided for successive investment. Performance metrics are put in place; and these are not the traditional measures of market-share or GNP that are increasingly becoming less valid. Instead, they are the measure of intangible or intellectual performance referenced in the Triple Knowledge Lens (above). In this Development Phase, new governing policies are determined and more effective managerial practices set in motion. Ultimately, all results feed into a Deployment Phase in which all is promoted or diffused within a constituency. But this is not done as the end of a value chain. It is an integral part of the knowledge innovation value system in which feedback becomes an instrument in calibrating impact and a tool to adjust new performance metrics that govern progress.
The Road Ahead
As companies or countries, executives pursue management in such a manner that knowledge citizens derive wellness, and meaning, as well as prosperity in the process. Now, in the Knowledge Economy, with ever-increasing dependence upon stakeholder knowledge, we have a new mandate for involvement that goes beyond the charitable contributions or marketing support of the past. We are an inevitable and integral part of the network constellation of real-time innovation performance, leading to the sustainability of our customers, companies and countries.
World leaders met in Bretton Woods, New Hampshire in 1944. There, Henry Morganthau outlined plans for: “Creation of a dynamic world community in which the peoples of every nation will be able to realize their potentialities for peace." They abandoned gold as a world monetary standard because it was limiting the global economy. – is rapidly becoming the new currency.
We have now entered the innovation frontier. Today we know that intellectual capital – properly leveraged through relationship capital – is the new currency to provide a very different paradigm from previous agricultural, industrial, or service economies. It is one resting on the value of human potential and how it will be leveraged. The world is now our landscape. History will document our success.
References:
Amidon, Debra M. (2003), The Innovation Superhighway: Harnessing intellectual capital for sustainable collaborative advantage, Butterworth-Heinemann [ISBN: 0750675926].
Amidon, Debra M. and Davis, Bryan Elliott (2004), “Get in the Zone”. Knowledge Management, Vol. 8 Issue 2, October.
Amidon, Debra M., Formica, Piero and Mercier-Laurent, Eunika (Eds.) (2006), Knowledge Economics: Principles, Practices and Policies. Tartu University Press (Estonia) [ISBN 9985-56-939-3].
Bindé, Jérôme (2005), Toward Knowledge Societies, UNESCO Report [04-11-2005].
Elkington, John. (1988) Cannibals with Forks: The Triple Bottom Line of 21st Century Business New Society Publishers [ISBN: 0865713928].
Hassan, Javid and Al-Zahrani, Ali (2005). “Abdullah Launches Mega Economic City”. Arab News, December 21.
Websites:
http://www.mastering-echange.com/KEN-RITSEC/RITSEC-Masterfile-Web.htm.
About the Authors
Debra M. Amidon, founder and CEO of ENTOVATION International Ltd. and the E100 Network, is an architect of the knowledge economy and published expert on the theory and practice of knowledge, technology and innovation strategy. With over thirty years of executive experience in education, government and industry, she has consulted to national, regional and societal organizations, including the Asian Productivity Organization, World Bank, EU, and the UN with presentations throughout the Americas, Europe, Asia, the Middle East, Australia and Africa.
Bryan Elliot Davis, based in Toronto Canada, is founder and President of The Kaieteur Institute – a leading research think tank, applied knowledge laboratory and knowledge practices network. A leading authority on knowledge markets, knowledge-based business design and knowledge pattern recognition, he has been featured in Signal Magazine, Knowledge Management, the IEEE Computer Society ITProfessional and in EC and IT Research Analyst reports.
They have co-authored a seminal international research report Knowledge Innovation Zones – The State-of-the-World (forthcoming 2006).
Submitted for publication – IC Magazine (Spring 2006)