Building The Company Around Know-How, Not Knowledge

As I work on building this company, I think one of the problems I discovered that I needed to solve to establish that this company has a chance to succeed is the difference between knowledge and Know-how.

It seems to me that many companies in the 20th century were built on the limited availability of knowledge. Large companies compiled vast amounts of tangible knowledge in paper files and intangible knowledge in personal and corporate relationships, and few companies could compete with these collective knowledge bases. Good examples were the catalogue retailers (Sears) and car companies (General Motors) which had databases of tens of millions of clients, tens of thousands of dealerships, and long-standing relationships that could be leveraged whenever a company wanted to introduce new products.

The widespread proliferation of info databases and the development of technology to create, manage and interpret the info in those databases destroyed the competitive advantage of large companies. Now anyone with a computer, a database software program like Microsoft Access, and some knowledge of writing business rules could create an application that captured, analyzed and reproduced information in any number of forms: analytical reports, mailing lists, form letters, and more. And knowledge - for example, the number of used cars in the marketplace - could be aggregated and presented in an easy-to-use format.

The Internet obliterated the final barriers to obtaining and analyzing competitive info. Knowledge was now publishable at any time and everywhere at once to anyone and by anyone who had a computer and a website and a backend database; search engine technology allows us to type in a few keywords and bring to our desktop vast amounts of knowledge on any subject of our choosing. Knowledge has now become essentially free, and so the differentiating factors in business success are not the knowledge your company creates and aggregates, but what you can do with it.

Unfortunately, it seems to me that the dot-com technocrats didn't see that the rapid proliferation of knowledge and its availability to everyone would eliminate knowledge as a competitive advantage. Many of them concentrated on the creation of tools and the aggregation of knowledge instead of the application of knowledge in solving problems for clients and providing value added services.

I don't want to make that mistake. There are more than enough tools and a core knowledge supply that is almost limitless. The question now: how to leverage the tools and apply the knowledge in unique and profitable ways. That's what I'm working on. That's the only competitive advantage I see that can ensure the success and survival of this enterprise.