Published On: Wed, Feb 5th, 2014

Leading change in a knowledge economy

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(By Pharm. Nelson Okwonna)

“Money motivates neither the best people, nor the best in
people. It can move the body and influence the mind, but it
cannot touch the heart or move the spirit; that is reserved
for belief, principle, and morality. As Napoleon observed,
‘No amount of money will induce someone to lay down their
life, but they will gladly do so for a bit of yellow
ribbon.'” – Dee Hock (founder of VISA)



Leadership at the centre is all about causes. They reveal who the leader is, and the things that matter to him. Basically then, the best of leaders are those with the best causes.

This illustration reveals how effective team leaders function:

Pharmaceutical Business

These leaders lead from the centre. They tell the team “why” they have to do the things they are doing. The outer part, “what”, shows their products and services; while the inner part, “how”, shows their operative strategy. The core is where leadership begins.

A great leader is one with a great cause and who goes about it in the best possible way. The process of leadership is about influence and there are three ways to influence individuals: compulsion, manipulation and persuasion.

The first two are against the free spirit of man and the inherent laws of nature. Brute force has always worked with lower animals but never with man. Manipulation, on the other hand, can be very effective but is always devoid of charity which is the vitality of life; hence it is not in line with the basic nature of reality and cannot produce lasting results.

Compulsion says “do this or…”. It thrives on the strength of the leader. If the leader is strong enough then he is compelling enough. Actions are taken not because of the desire to act, but for fear of the penalty for inaction. The strength could be derived from position, financial clout or from emotional dependence.


Persuasion appeals to the good judgement of an individual; it presents facts and figures and aims to convince the other party to tow a given line. Persuasion seeks to inspire the follower to follow simply because in so doing he will also find good for himself. No doubt, a persuasive leader at times will need to compel obedience but he knows he must not dwell on that and if he must then that particular team member would need to be changed.


In the agrarian and industrial era, the landowners and the employer of labour had the balance of power in their favour and could manipulate or compel labour to act in their interests. Despite the development of labour unions, the employer of labour still had a greater bargaining chip and could exploit the labour greatly.

This was possible because of the abundance and ease of mobility of labour; it was relatively easy to find a replacement for a factory worker at a very short notice as the contribution was either semi-skilled or unskilled labour.

As the industrial era led to the computer era, the degree of skill possessed by labour increased dramatically. Consequently, employers of labour started paying closer attention to human resource management as the individual roles of these employees became much more of a determinant to the outcome of the enterprise. The ease of replacement became considerably reduced.

In this era, the employee earned much more and could afford to stay off work for a considerable duration of time while looking for a more satisfactory employment. The relationship between employer and employee became more of a partnership and the salary was no longer the greatest bargaining chip. Other factors like insurance, availability of crèche facility, maternity leave, holidays, management disposition and location of the enterprise became important considerations for the choice of where to offer services.

In this knowledge era, the individual, and not land or money, is king, as the contribution of knowledge workers has become the determinant of the success of any enterprise. The leader of nearly every successful business is essentially a knowledge worker and a great business is one with many of such leaders on its team.

Here, the enterprise is “the team”, and the preoccupation of the chief executive officer is more of providing leadership for this team, to persuade team members to not only stay with the team but to contribute their knowledge. Many times, this leader would have to identify individuals needed for building a particular kind of team and to go about persuading them to join the team.

Leaders who are willing to contribute consistently to the society in this era must realise that the game has changed very much. The words of Jesus Christ has become much more relevant in the market place: “He that wants to be the greatest, let him be the servant of all”.

Leadership is serving the need of the team; it is keeping them happy and focused on the vision. A lot of employers and managers are yet to grasp this understanding and have inevitably shot themselves in the foot. They have succeeded in employing unwilling hands. In such organisations, the staffs are there simply because they have nowhere else to go. These leaders have missed the privileges that come from operating in a knowledge economy, and they have deprived their firms of the magic that pooled intellectual capital can create.

In a business particularly, the challenge of leadership is to discover that strategic reward system that rewards impressive efforts effectively. When this reward system is not in place the leader will oftentimes find that his employees leave to build companies that will compete with his. The result is that both firms produce at suboptimal levels. A new shift in leadership in our era comes with the realisation that a firm may never be able to own the intellectual capacity of an individual completely and this intellectual capital matter greatly. The responsibility therefore is to create structures that allow certain key individuals to own or have a certain degree of ownership on the results of their intellectual capacities; this will lead to decreased human resource turnover rates.

To achieve this, the organisational structure of the organisation may need to change.


Much more than ever, great staffs are hard to find. Individuals with the rare combination of integrity, passion, competence and commitment are rare to find and they do not migrate to manipulative or compulsive systems. If you find them in such manipulative teams, it wouldn’t be for long.

Persuasion, therefore, is the act of convincing relevant individuals to join the cause of your organisation. It is retaining their respect by giving them due respect for their potentialities and capacities. It is refusing to belittle anyone.

This can be achieved using some time-tested approaches:

  • By effectively communicating the vision of the enterprise.
  • Communicating the personality, values and passion of the leader.
  • Standardising the compensation plan: salaries, equity, capacity development, etc.
  • Regulating the structure of the enterprise.



In this information age, intellectual capital is becoming an investable entity that can be quantified in monetary terms. The level of knowledge or the corporate IQ of your firm is a reflection of the corporate information flow and processing in your organisation.

Everybody knows that the boss doesn’t know it all. Even if he does, everybody also knows that he cannot be there all the time. Every day there is new information in your area of business and chances are that the staff know many things the boss needs to hear. The key is building an atmosphere that makes such contributions possible.

A staff’s ability to contribute positively to the firm would depend on the level of information available to him or her. It is the job of the leader to paint the big picture for the team and dare them to make the necessary contributions.

Bill Gates in his book “Business at the Speed of Thought”, introduced the concept of the Digital Nervous System (DNS). The DNS occurs when thinking and collaboration are significantly assisted by computer technology. The “nervous system” of an organisation should be horizontal enough to share information with employees. When the employees can get the most information from the organisation and the organisation can get the most information from the employees, the corporate IQ becomes the collective IQ of its employees/associates.

This information flow system assumes that employees want to do a good job, which is the absolute truth. Most times employees do want to do a good job.


Without integrity, a leader cannot be authentic (real) and phony leaders cannot sustain a character of information flow in any system as they cannot stand discovery. Integrity, authenticity and candour are therefore cardinal attributes for the viability of the points earlier made.

Leadership, as explained from the outset, is about causes. “It is all about love” says Tom Peters, and I agree.

Love is defined as passion, enthusiasm, appetite for life, engagement, commitment, great causes and determination to make a difference, shared adventures, growth, and an unshakable appetite for change.

To communicate this passion, the leader must be real (authenticity) and talk real (candour). He must be able to see eye to eye with his team members and to motivate them to the next level.

Sound like an impossible job?

Welcome to the club! Attempt is the first virtue; go out there and do it!

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Leading change in a knowledge economy