Global Intellectual Capital Sharing and Knowledge Management

WHILE TALKING TO SOME Scandinavians the other day, I thought of CIO.com?this magazine’s online incarnation. It turns out that Scandinavians are also attracted by the idea of a place where people can gather to exchange ideas, share best practices and talk to their peers to glean insights into what’s going on in the world.

They see these sites as “future centers,” modeled along the lines of the mass-market Ikea furniture stores. You go in, collect the “knowledge recipes” you require, assemble them, and?hey presto!?you’ve usefully augmented your intellectual capital.

But what does this kind of activity, which is part of the present boom in knowledge management, have to do with CIOs? The dangerous answer so far is “Not much.” Few CIOs see the word information in their title as embracing intellectual capital. But if the gurus are right, and information is now the true capital of companies, the CIO had better be custodian of content as well as common carrier.

And that requires massive changes in mind-set, especially in a global setting. Managing data flows is one thing?managing the flow of real information and intellectual capital, quite another.

Dotcom Fusion

For all its hyper-hyped stock prices, blazing “cash-burns” and loony business models, the dotcom boom marked an important stage in information management. At last, channel and content were fused: Business and information systems became one and the same, instead of master and servant. Does Amazon.com sell books?or cleverly understand how people buy books, why people buy books and what books people might like to buy next?

The fusion has been a long time coming. Noting that “Decentralized computing is sweeping business like a wave rolling onto a beach,” John J. Donovan once warned Harvard Business Review readers that the resulting tangle of systems could be resolved by only a new breed of IT executive?a network manager.

That was 1988, when Donovan’s words inspired me to predict that “Unless these people convert themselves from overlords of vast hardware and software investments and budgets, and concentrate instead on networks, their companies cannot enter the age of decentralized computing…the top IT executive has to make surrender after surrender.”

A Test Case

A decade later I tested this prediction against the realities of a European financial services giant with global aspirations. Ever since computers first passed through its portals, the company had led its sector in information technology. A now-legendary CIO came to dominate not just its IT but the core business itself, controlling how and when it developed its products and services?products and services that relied on information technology, certainly, but that relied more extensively on the company’s intellectual capital.

The CIO was master, and his authority was exercised like a presidential veto. But as the millennium neared, Donovan’s sorry tangle was all too apparent. Nobody was happy. People couldn’t get the information they wanted when they wanted it. Manual systems still caused roadblocks and errors. Computer could not speak unto computer. Despite the lofty dreams, global expansion had in fact been minimal.

Radical surgery was the only solution. The CIO left, a dynamic board executive led an intranet-based program that revolutionized the company’s internal workings, and the giant then comfortably reverted to its old, conservative, slow-moving ways. Its global ambitions have probably been thwarted for good.

Who Will Survive?

These days, conservative information management should be a contradiction in terms?not only because of accelerating technology or because world business means worldwide harmonization, but also because dotcom-style fusion is vital. Every new exploitation of the Internet repeats the threat that decentralized computing once posed. And if that, to borrow Donovan’s phraseology, was “a wave rolling onto a beach,” then the Web and all its works are a devastating tsunami exploding onto the economic coastline. But when the waters recede, what businesses will have survived?

My guess: those that work hardest to build systems that move not just data around the world but genuine information.