The importance of the knowledge economy

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Conor Gilligan, Vice President at webanywhere – a multi award-winning eLearning provider – looks at how the diversification of the knowledge economy will affect the future workplace.

More than ever, companies and entire countries are exploring how they can skill up to cater for the increasing demands of the workplace and skills required. The knowledge embodied in human beings (as ‘human capital’) and in technology have always been central to economic development.

It has been estimated that more than 50% of GDP in major economic co-operation and development (OECD) countries is due to knowledge-based activities.

Knowledge and learning

As a result in this shift to the knowledge economy, skills development has become more important than ever. In a corporate environment, employees are no longer expected to focus on one area and are being constantly challenged to develop their skills more quickly.

The demand for this speed of change is due to the vast amount of knowledge and information available via mobile devices.

For example, retailers such as H&M are competing with online fashion companies such as ASOS. Traditionally, a typical customer would walk into a H&M shop looking for something to buy. Instead of selecting and buying at the counter, consumers are now using ecommerce to make price comparisons online.

How does the sales consultant in the store manage this? Kraft Foods has used this new way of shopping to develop a social knowledge sharing platform which includes clever tagging to link learning across stores and includes pricing experts.

In a corporate learning environment there are three main pillars to knowledge acquisition, these are:

  • Knowledge production – this involves the creation of new knowledge;
  • Knowledge transmission – educating and developing human resources; and
  • Knowledge transfer- disseminating this knowledge to teams.

Another driving force behind the knowledge economy is the millennial. According to a survey by PwC, around 41% of millennials prefer to communicate electronically rather than on the phone.

Within the corporate environment, are we ready for this?

The BBC documentary by Prof Robert Winston, ‘Child of our time’, explains how the modern 16-year-old is constantly wired to social media and how this is shaping their ability to cope with stress, sleep and social situations. This is a challenge as the 16-year-old of today may look grown up, but they are actually still developing during these formative years.

Re-shaping the workplace

As a result of the knowledge economy, the skills required in the workplace are constantly changing. New skills such as data science, artificial intelligence and machine learning are in high demand. According to the World Economic Forum, this burst in innovation is going to be the fourth Industrial Revolution.

The new forum report looks at employment, skills and workforce strategy. By interviewing top HR professionals, the report compares the top 10 skills from recent years to those required in 2020.

The biggest change is ‘creativity’ moving from 10th to first position in 2020. The birth of new technologies and ways of working has meant that employees will have to become more creative. Another new addition to the list is ‘emotional intelligence’ which is not featured in 2015, but appears in 6th place for 2020.

Finally, ‘complex problem solving’ remains in 1st position and ‘critical thinking’ will move from 4th to 2nd position.

In conclusion, the changes in workforces due to the knowledge economy will continue to give rise to a higher dependency on lifelong learning. Rather than this being a formal process in the corporate learning environment, teams will be expected to share and curate their knowledge to increase competitiveness. This will move away from traditional learning methods to a more on demand model.

Contact Conor Gilligan, Vice President at Webanywhere

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