New Economy:

Winning Organization

Knowledge-based Enterprise

Knowledge Management as a Key to Sustainable Competitive Advantage

By: Vadim Kotelnikov

"In tomorrow's business environment, knowledge and how it is managed for competitive advantage will be the number one corporate priority." ~ James J. Schiro, CEO, PricewaterhouseCoopers 



Knowledge versus Industrial Enterprise

Corporate Attributes1



Economies of scale

Smaller business units

Standardization of work

Customization of work

Standardization of workforce

Flexible, multi-skilled workforce

Financial capital as scarce resource

Human capital as scarce resource

Corporate HQ as operational controller

Corporate HQ as advisor & core competency guardian

Hierarchical pyramid structure

Flat or networked structure

Employees seen as expense

Employees seen as investment

Internally focused top-down governance

Both internal and external distributed governance

Individualistic functional orientation

Team orientation, emphasis on cross-functional teams

Information based on "need to know"

Open & distributed information system

Vertical decision making

Distributed decision making

Emphasis on stability

Emphasis on change

Emphasis on vertical leadership

Emphasis on empowered self-leadership




Dangerous Attitudes

Characterizing Old and New Organizations3


Old Organization

New Organization

Individual Motivation

Power / Security

Get rich quick

Organizational Structure



Leadership Style



Teamwork Style


Instrumental (what's in it for me?)

Customer Attitude

If they were here before, they will come back

Customers are dumb. we know better.

Capital Markets

We've been here forever. We'll survive.

We are "new economy", so we win.


 Discover more!

Winning Organization

Learning Organization

Teaching Organization

Coaching Organization

Managing Knowledge Workers

Employee Empowerment

Enlightened 21st Century Organization Quiz

Knowledge Management


Knowledge Communities

Idea Management

Creativity Management in Your Business Environment

Letting the Best Idea to Win


Cross-pollination of Ideas

Balanced Organization: 5 Basic Elements

Leadership (Fire):

Sources of Knowledge

A knowledge-based enterprise derives knowledge from various sources that include:

Managing Knowledge Enterprise

Within a rapidly changing environment of the new knowledge economy, the latest information and knowledge is the key to sustained success and competitive advantage. In today's e-learning and e-business accelerated world, information quickly converted into knowledge at the point of highest business impact is a matter or survival. Switching to leadership approaches, employee empowerment, establishing a continuously learning organization, knowledge management and management of knowledge workers become very important manager's tasks. Knowledgeable workers seek service that support their knowledge. Unused knowledge depreciates very fast. On the opposite, using knowledge creates new opportunities which in turn create new knowledge.

Business Strategies in Different Economies

By Jim Botkin2

In the information economy (1970 to 1995), the best strategy was to overinvest in crunching power. Competitive advantage accrued to those who invested more than their competitors to process more data and information more quickly.

In the knowledge economy (1995 to date), the best strategy is to invest in connecting power. Competitive advantage accrues to those who invest more than their competitors to connect to more people and share knowledge faster and farther.

Managing Knowledge

While most managers agree that managing knowledge is important, few of the can articulate what the value is or how to become a learning, teaching, or coaching organization. The majority of companies have their knowledge embedded in people and organizations. It is often intuitive, tacit, rather than explicit, and is rarely detailed enough to be especially valuable. Such knowledge often gets lost when someone leaves the company. "All too often, knowledge exists with multiple points of view instead of the collective best thinking. It is occasional but not integral to the business. And, most important, it is available but not used very much."4... More

Managing Knowledge Workers

To lead knowledge workers effectively and unlock their true potential, you need to define:

  • What knowledge work professionals do?

  • How they do it best?

  • What drives them to do it?... More

Organizing Knowledge Communities

Use entrepreneurial approaches to organize knowledge communities within your organization to give it what it needs most radical innovation. Knowledge communities organized around the principles of entrepreneurship have the best chance at success. Members of these communities exciting, entrepreneurial, and highly profitable would emulate entrepreneurs acting less like followers and more like empowered founders and builders of new organizational value... More

Innovation in Industrial vs. Knowledge Enterprises...

Three Areas of Need Present in All Organizations...

Key Characteristics of High-performance Organizations...

Achieving the Right Balance Between the Whole and the Parts...

6-A: Important Traits that Determine Organizational Success...

Establishing an Attitude of Relentless Growth...

Organizational Alignment...

Extended Enterprise...

Organizational Fitness Profile (OFP) Road-Mapping...

80/20 Theory of the Firm...

Continuous Corporate Renewal...

Managerial Leadership...

Learning Bottom-Up...

Trust-based Working Relationships...

How To Bring About Effective Change...

 Case Study  GE...

 Case Study  British Petroleum...

 Case Study  IDEO...

Case Study  Google...





  1. "Vision of the Future", Corporate Leadership Council, Washington, D.C.

  2. "Smart Business", Jim Botkin

  3. "The Cycle of Leadership", Noel M. Tichy with Nancy Cardwell

  4. "The Centerless Corporation", Bruce A.Pasternack and Albert. J. Viscio

  5. "Effective Managers Need To Coach," Wendy Hearn