The Wisdom-based Economy

Say good-bye to the knowledge-based economy. Knowledge is everywhere. We are awash in a sea of knowledge. It is a commodity today. Say hello to the Wisdom-based Economy. This economy is driven by not only knowing how to use the knowledge we have access to, but understanding the subtle and powerful relationships among the various elements that come together to make wise decisions—sustainable decisions in a global marketplace. Let me explain my thinking.

What’s the difference between then and now? Simple. In the knowledge-based economy, which gave birth to the Technology Boom, it was all about information and speed—now—fast, and reach—seizing market share and “grabbing eyeballs”. Perception became reality in the worst sense. “We must do things faster—at Internet Speed!” That was the cry of every IPO-crazed technology entrepreneur and it pretty much summed up the sense of urgency which permeated the knowledge-based economy. There wasn’t even time for the Venture Capitalists, who were funding this wild growth, to hear the complete story from those who were seeking money. “Give me your ‘elevator speech’!”—which was Silicon Valley-speak for, “You’ve got three minutes. Excite me.”—was about all you could get a Venture Capitalist to say to you.

Many business models didn’t make sense but still got funded (WebVan, Pets.com, furniture.com and on and on). In fact, legendary investor, Warren Buffet even commented that what was happening was not investing but speculating, "in which the focus is not on what an asset will produce, but what the next fellow will pay for it." In his words these were "entities designed more to making money off investors than for them.”

This mentality spread and common sense went out the window. It even became “cool” not to have time to do anything or to talk to anybody. In response to my asking how they were doing one day, I remember someone saying to me “Can’t talk now--I’m running around with my hair on fire!”

Unfortunately, this is how many younger people got their first exposure to the business world. Fortunately, though, for the sake of the development of a whole generation of young professionals, April 14th, 2000, came. That’s the day the knowledge-based economy died—NASDAQ experienced its largest ever one-day decline—more than 355 points. The world went into a state of shock. Then, after the predictable periods of hope, denial, anger, hope again, and finally resignation, people began to sift through the ashes of what was the result of many people running around with their “hair on fire”.

The reason I say this was a fortunate event for a generation of young professionals is that it dispelled the myth, literally, of overnight success, of rudeness being viewed as a desirable trait, of thinking that everyone else is expendable, and my favorite, the tech boom’s definition of relationship management, which was “What is the least I can do in order to get you to buy more from me?” Further, in the intervening years, I think we all have learned an important lesson about knowledge in general, and the knowledge-based economy in specific, which is best summed up by this question posed by T.S. Eliot many years ago, “Where is the wisdom that is lost in knowledge?”

Let’s take a look at a couple of definitions that I think will help explain my point. The American Heritage Dictionary offers the following:
Knowledge: “The state or fact of knowing.”
Wisdom: “The ability to discern or judge what is true, right, or lasting; insight.”

And that brings us to today, The Wisdom-based Economy. Yes, knowledge is an important part of the Wisdom-based Economy, but only a part of it. In today’s world of business it’s not what you know. It’s how well you can use what you know that matters. We all have access to knowledge. The future, however, belongs to those who cultivate the wisdom of how to use that knowledge in the proper context. It belongs to those who understand that sometimes it’s more important how or when something is done than what is done. It belongs to those who take the time to fully understand the needs of others before formulating solutions or displaying their brilliance. The Wisdom-based Economy is fueled more by active listening than talking. It is more inclusive in its search for solutions because sustainability, insight, context and common sense are the key words in the Wisdom-based Economy, not grabbing eyeballs, Internet speed, and elevator speeches.

Simply put, this economy is based on the useful application of knowledge, and it offers just as much opportunity in Central Europe as it does in any other part of the world.

Good luck on your way up!